[Congressional Record (Bound Edition), Volume 149 (2003), Part 12]
[Senate]
[Pages 16604-16633]
[From the U.S. Government Publishing Office, www.gpo.gov]




    PRESCRIPTION DRUG AND MEDICARE IMPROVEMENT ACT OF 2003--Resumed

  The PRESIDENT pro tempore. Under the previous order, the hour of 9:15 
a.m. having arrived, the Senate will proceed to the consideration of S. 
1, which the clerk will report.
  The legislative clerk read as follows:

       A bill (S. 1) to amend title XVIII of the Social Security 
     Act to make improvements in the Medicare Program, to provide 
     prescription drug coverage under the Medicare Program, and 
     for other purposes.

  Pending:

       Kerry amendment No. 958, to increase the availability of 
     discounted prescription drugs.
       Lincoln modified amendment No. 934, to ensure coverage for 
     syringes for the administration of insulin, and necessary 
     medical supplies associated with the administration of 
     insulin.
       Lincoln amendment No. 935, to clarify the intent of 
     Congress regarding an exception to the initial residency 
     period for geriatric residency or fellowship programs.
       Lincoln amendment No. 959, to establish a demonstration 
     project for direct access to physical therapy services under 
     the Medicare Program.
       Baucus (for Jeffords) amendment No. 964, to include 
     coverage for tobacco cessation products.
       Baucus (for Jeffords) amendment No. 965, to establish a 
     Council for Technology and Innovation.
       Nelson (FL) amendment No. 938, to provide for a study and 
     report on the propagation of concierge care.
       Nelson (FL) amendment No. 936, to provide for an extension 
     of the demonstration for ESRD managed care.
       Baucus (for Harkin) amendment No. 968, to restore 
     reimbursement for total body orthotic management for 
     nonambulatory, severely disabled nursing home residents.
       Baucus (for Cantwell) amendment No. 942, to prohibit an 
     eligible entity offering a Medicare prescription drug plan, a 
     Medicare Advantage organization offering a Medicare Advantage 
     plan, and other health plans from contracting with a pharmacy 
     benefit manager (PBM) unless the PBM satisfies certain 
     requirements.
       Rockefeller amendment No. 975, to make all Medicare 
     beneficiaries eligible for Medicare prescription drug 
     coverage.
       Akaka amendment No. 980, to expand assistance with coverage 
     for legal immigrants under the Medicaid Program and SCHIP to 
     include citizens of the Freely Associated States.
       Akaka amendment No. 979, to ensure that current 
     prescription drug benefits to Medicare-eligible enrollees in 
     the Federal Employees Health Benefits Program will not be 
     diminished.

[[Page 16605]]

       Bingaman amendment No. 973, to amend title XVIII of the 
     Social Security Act to provide for the authorization of 
     reimbursement for all Medicare Part B services furnished by 
     certain Indian hospitals and clinics.
       Baucus (for Lautenberg) amendment No. 986, to make 
     prescription drug coverage available beginning on July 1, 
     2004.
       Murray amendment No. 990, to make improvements in the 
     Medicare Advantage benchmark determinations.
       Harkin modified amendment No. 991, to establish a 
     demonstration project under the Medicaid Program to encourage 
     the provision of community-based services to individuals with 
     disabilities.
       Dayton amendment No. 960, to require a streamlining of the 
     Medicare regulations.
       Dayton amendment No. 977, to require that benefits be made 
     available under Part D on January 1, 2004.
       Baucus (for Dorgan) amendment No. 993, to amend title XVIII 
     of the Social Security Act to provide for coverage of 
     cardiovascular screening tests under the Medicare Program.
       Smith/Bingaman amendment No. 962, to provide reimbursement 
     for federally qualified health centers participating in 
     Medicare managed care.
       Hutchison amendment No. 1004, to amend title XVIII of the 
     Social Security Act to freeze the indirect medical education 
     adjustment percentage under the Medicare Program at 6.5 
     percent.
       Sessions amendment No. 1011, to express the sense of the 
     Senate that the Committee on Finance should hold hearings 
     regarding permitting States to provide health benefits to 
     legal immigrants under Medicaid and SCHIP as part of the 
     reauthorization of the Temporary Assistance for Needy 
     Families Program.
       Conrad amendment No. 1019, to provide for coverage of self-
     injected biologicals under Part B of the Medicare Program 
     until Medicare prescription drug plans are available.
       Conrad amendment No. 1020, to permanently and fully 
     equalize the standardized payment rate beginning in fiscal 
     year 2004.
       Conrad amendment No. 1021, to address Medicare payment 
     inequities.
       Clinton amendment No. 999, to provide for the development 
     of quality indicators for the priority areas of the Institute 
     of Medicine, for the standardization of quality indicators 
     for Federal agencies, and for the establishment of a 
     demonstration program for the reporting of health care 
     quality data at the community level.
       Clinton amendment No. 953, to provide training to long-term 
     care ombudsman.
       Clinton amendment No. 954, to require the Secretary of 
     Health and Human Services to develop literacy standards for 
     informational materials, particularly drug information.
       Reid (for Boxer) amendment No. 1036, to eliminate the 
     coverage gap for individuals with cancer.
       Reid (for Corzine) amendment No. 1037, to permit Medicare 
     beneficiaries to use federally qualified health centers to 
     fill their prescriptions.
       Reid (for Jeffords) amendment No. 1038, to improve the 
     critical access hospital program.
       Reid (for Inouye) amendment No. 1039, to amend title XIX of 
     the Social Security Act to provide 100 percent reimbursement 
     for medical assistance provided to a Native Hawaiian through 
     a federally qualified health center or a Native Hawaiian 
     health care system.
       Thomas/Lincoln amendment No. 988, to provide for the 
     coverage of marriage and family therapist services and mental 
     health counselor services under Part B of the Medicare 
     Program.
       Edwards/Harkin amendment No. 1052, to strengthen 
     protections for consumers against misleading direct-to-
     consumer drug advertising.
       Enzi/Lincoln amendment No. 1051, to ensure convenient 
     access to pharmacies and prohibit the tying of contracts.
       Enzi amendment No. 1030, to encourage the availability of 
     Medicare Advantage benefits in medically underserved areas.
       Hagel/Ensign amendment No. 1012, to provide Medicare 
     beneficiaries with an additional choice of Medicare 
     prescription drug plans under Part D that consists of a drug 
     discount card and protection against high out-of-pocket drug 
     costs.
       Hagel amendment No. 1026, to provide Medicare beneficiaries 
     with a discount card that ensures access to privately 
     negotiated discounts on drugs and protection against high 
     out-of-pocket drug costs.
       Baucus (for Feinstein) amendment No. 1060, to provide for 
     an income-related increase in the Part B premium for 
     individuals with income in excess of $75,000 and married 
     couples with income in excess of $150,000.
       Baucus (for Akaka) amendment No. 1061, to provide for 
     treatment of Hawaii as a low-DSH State for purposes of 
     determining a Medicaid DSH allotment for the State for fiscal 
     years 2004 and 2005.
       Bingaman/Domenici amendment No. 1065, to update, beginning 
     in 2009, the asset or resource test used for purposes of 
     determining the eligibility of low-income beneficiaries for 
     premium and cost-sharing subsidies.
       Bingaman amendment No. 1066, to permit the establishment of 
     two new Medigap plans for Medicare beneficiaries enrolled for 
     prescription drug coverage under Part D.
       Graham (SC) modified amendment No. 948, to provide for the 
     establishment of a National Bipartisan Commission on Medicare 
     Reform.
       Stabenow/Levin amendment No. 1075, to permanently extend a 
     moratorium on the treatment of a certain facility as an 
     institution for mental diseases.
       Stabenow/Levin amendment No. 1076, to provide for the 
     treatment of payments to certain comprehensive cancer 
     centers.
       Stabenow/Levin amendment No. 1077, to provide for the 
     redistribution of unused resident positions.
       Ensign/Lincoln amendment No. 1024, to amend title XVIII of 
     the Social Security Act to repeal the Medicare outpatient 
     rehabilitation therapy caps.
       Smith/Feingold amendment No. 1073, to allow the Secretary 
     to include in the definition of ``specialized Medicare+Choice 
     plans for special needs beneficiaries'' plans that 
     disproportionately serve such special needs beneficiaries or 
     frail, elderly Medicare beneficiaries.
       Grassley (for Craig) amendment No. 1087, to permit the 
     offering of consumer-driven health plans under Medicare 
     Advantage.
       Baucus (for Mikulski) amendment No. 1088, to provide 
     equitable treatment for children's hospitals.
       Baucus (for Mikulski) amendment No. 1089, to provide 
     equitable treatment for certain children's hospitals.
       Baucus (for Mikulski) amendment No. 1090, to permit direct 
     payment under the Medicare Program for clinical social worker 
     services provided to residents of skilled nursing facilities.
       Baucus (for Mikulski) amendment No. 1091, to extend certain 
     municipal health service demonstration projects.
       Grassley/Baucus amendment No. 1092, to evaluate alternative 
     payment and delivery systems.
       Kyl amendment No. 1093 (to amendment No. 1092) in the 
     nature of a substitute.


                           amendment no. 991

  The PRESIDENT pro tempore. There will be 2 minutes equally divided on 
the amendment.
  Who seeks recognition?
  The Senator from Iowa.
  Mr. HARKIN. The amendment before us is the one where the money 
follows the purse. It is $350 million a year for 5 years whereby States 
can use this money to get out of institutions, out of nursing homes, 
people with disabilities and get them into community, home-based 
living.
  Thirteen years ago, this Congress and the President signed a bill 
called the Americans With Disabilities Act. One of the premises of that 
was we no longer wanted to segregate people with disabilities in our 
society. We wanted to integrate people with disabilities in education, 
work, travel, jobs, everything. However, under the Medicaid system, it 
is still segregation.
  Seventy percent of our Medicaid money goes to institutional care, 
only 30 percent to community-based care. What this amendment says is 
that for the first year, the Federal Government will pick up the full 
share of the State so the State can take people out of institutions and 
put them into community-based living.
  This was proposed by President Bush in his budget proposal for next 
year. It is exactly what the President proposed.
  The PRESIDENT pro tempore. The Senator's time has expired.
  Mr. HARKIN. I ask unanimous consent for an additional 30 seconds.
  The PRESIDENT pro tempore. Without objection, it is so ordered.
  Mr. HARKIN. The offset we use is also an offset supported by the 
administration. I have a letter Senators can look at--I put it in the 
Record last night--from the Department of Justice, supporting the 
offset we use to pay for this to ensure that we can get people in 
community-based settings and out of institutions.
  I yield the floor.
  Mr. SMITH. Mr. President. I would like to urge my colleagues to 
support the Harkin/Smith Money Follows the Person Amendment pending 
before the Senate.
  This amendment would authorize the 2004 Money Follows the Person 
initiative in Medicaid, a part of the President's New Freedom 
Initiative to integrate people with disabilities into the communities 
where they live.
  This amendment would create a 5-year program to help States move 
people with disabilities out of institutional settings and into their 
communities. For example, under this legislation, Oregon's effort to 
help an individual move out of an institutional

[[Page 16606]]

care facility and into a community home would be 100-percent federally 
funded for 1 year.
  After that first year, the Federal Government would pay its usual 
rate. Under the provisions of this amendment, states like Oregon can 
take advantage of $350 million dollars of Federal assistance for 5 
years for a total of $1.75 billion.
  This amendment is important to the disabled community for many 
reasons. First, by supporting States' efforts to help Americans who 
have been needlessly placed in institutional settings move into 
community settings, this amendment will help States increase access to 
home and community-based support for people with disabilities.
  Second, by assisting the movement of people who are not best served 
by an institution into a community care facility, this amendment gives 
them the freedom to make choices. Too often, Americans with 
disabilities are unable to take advantage of opportunities others take 
for granted--to choose where they want to live, when to visit family 
and friends, and to be active members of their communities.
  Third, this amendment helps honor those veterans whose disabilities 
resulted from noble and selfless service to this Nation. This morning, 
I heard from the head of the Oregon Chapter of the Paralyzed Veterans 
of America. He confirmed that this amendment would benefit countless 
disabled veterans in Oregon alone. I would ask unanimous consent that 
the letter that I received from the Paralyzed Veterans of America in 
support of this amendment be printed in the Record.
  I likewise ask unanimous consent that a letter I received from United 
Cerebral Palsy and The Arc of the United States in support of this 
amendment be printed in the Record.
  Finally, this amendment would help States comply with the Americans 
with Disabilities Act. As my colleagues in the Senate are well aware, 
we are nearing the 13th anniversary of the Americans with Disabilities 
Act and of the Olmstead Supreme Court decision.
  That decision ruled that needless institutionalization of Americans 
with disabilities constitutes discrimination under the Americans with 
Disabilities Act. I urge my colleagues on both sides of the aisle to 
support this important amendment and to support the freedom of choice 
for Americans with disabilities.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                                                   The Arc and UCP


                                  Public Policy Collaboration,

     Washington, DC, June 25, 2003.
     Hon. Gordon Smith,
     U.S. Senate, Russell Senate Office Building,
     Washington, DC.
       Dear Senator Smith: On behalf of United Cerebral Palsy and 
     The Arc of the United States, we applaud your co-sponsorship 
     of S. AMDT. 991 to the Prescription Drug and Medicare 
     Improvement Act that would authorize the Money Follows the 
     Person initiative in Medicaid proposed by President Bush in 
     his FY 2004 budget as part of his New Freedom Initiative.
       Senate Amendment 991 and the President's proposal would 
     create a five-year program to provide 100 percent federal 
     funding for one year on behalf of individuals who move from 
     an institutional setting to the community with home and 
     community services and supports. Money Follows the Person 
     would assist states in meeting their obligations under the 
     Olmstead Supreme Court decision to serve people with long 
     term support needs in the least restrictive setting. The Arc 
     and UCP believe that the Money Follows the Person initiative 
     will help states increase access to home and community-based 
     supports for people with disabilities and help states take 
     greater steps to permanently re-balance their long-term 
     supports delivery system. Changes in the institutional bias 
     in the Medicaid program are long overdue. The Money Follows 
     the Person initiative will assist states in making a 
     transition for people who want to leave institutional 
     settings.
       UCP is a national organization that works with and for 
     people with cerebral palsy and related disabilities and their 
     families. It is committed to promoting and improving supports 
     and services for people with disabilities so that they can 
     live, work, go to school and otherwise be fully included in 
     their communities. UCP also supports a broad range of 
     research and education efforts on cerebral palsy and related 
     disabilities.
       The Arc is the national organization of and for people with 
     mental retardation and related developmental disabilities and 
     their families. It is devoted to promoting and improving 
     supports and services for people with mental retardation and 
     their families. The Arc also fosters research and education 
     regarding the prevention of mental retardation in infants and 
     young children.
       We urge all Senators to join you and Senator Harkin to 
     support inclusion of your amendment, S. AMDT. 991, in the 
     Medicare Prescription Drug bill.
           Sincerely,
     Lynne Cleveland,
       Co-Chair.
     Leon Triest,
       Co-Chair.
                                  ____

                                         Oregon Paralyzed Veterans


                                                   of America,

                                         Salem, OR, June 25, 2003.
     Hon. Gordon Smith,
     U.S. Senate, Russell Senate Office Building,
     Washington, DC.
       Dear Senator Smith: On behalf of the Oregon Chapter of the 
     Paralyzed Veterans of America and other disabled citizens of 
     the state of Oregon, we thank you for joining Senator Harkin 
     in introducing Amendment 991 (``Money Follows the Person''), 
     to the Prescription Drug and Medicare Improvement Act of 2003 
     (S. 1). This amendment would authorize an initiative 
     contained in the President's proposed FY 2004 budget, a 
     critical part of the administration's New Freedom Initiative 
     to integrate people with disabilities into the community.
       Amendment 991 includes fiscal offsets of $1.75 billion over 
     five years to fund Medicaid demonstrations to assist states 
     in developing and implementing cost-effective choices between 
     institutional and community services. Financing Medicaid 
     services for individuals who transition from institutions to 
     the community is a major part of this effort.
       When enacted, the Federal Government would fully reimburse 
     states (100% Federal match) the cost of one year of Medicaid 
     home and community-based services for people with 
     disabilities who leave institutions. After the initial year, 
     states would be responsible for matching payments at their 
     usual Medicaid matching rate. $350 million would be available 
     in FY 2004 and in each of the following four years to 
     implement these changes.
       PVA believes that this amendment is essential to enable 
     Oregon and other states to comply with the Americans with 
     Disabilities Act and the Supreme Court's Olmstead decision. 
     People with disabilities must have a meaningful choice to 
     receive long term services and supports in their home or 
     community.
       Again, thank you for introducing Amendment 991 during the 
     prescription drug and Medicare debate.
           Sincerely,
     Sam Leam,
       President.
     Patrick E. Rogers,
       Government Relations Director.

  (At the request of Mr. DASCHLE, the following statement was ordered 
to be printed in the Record.)
 Mr. KERRY. Mr. President, I have been a long-standing 
supporter of the Olmstead decision to end the institutional bias in 
care for people with disabilities. Unfortunately, States have been slow 
to implement this landmark decision. To better help States in this 
effort, I am proud to say that I am an original cosponsor of Senator 
Harkin's MiCASSA legislation, S. 971, the Medicaid Community-Based 
Attendant Services and Supports Act of 2003, a bill to ensure that 
``the money follows the people'' and that true choice is granted for 
people with disabilities to decide whether they wish to live in their 
own communities instead of being institutionalized. The bill also 
provides major Federal resources to assist States with the costs of 
paying for community-based attendant and support services. Had I been 
present for the vote, I would have voted against the motion to table 
the Harkin amendment and would have voted in favor of its inclusion in 
the Medicare prescription drug bill.
  The PRESIDENT pro tempore. The Senator from Pennsylvania is 
recognized for 1\1/2\ minutes.
  Mr. SANTORUM. Mr. President, I think what the Senator from Iowa has 
done is a very worthy thing. The President has focused on this. Part of 
the President's plan is what the Senator from Iowa has before us. The 
problem with this is that this is a Medicaid proposal that is under the 
jurisdiction of the Finance Committee. The Finance Committee would like 
the opportunity, in the context of looking at the Medicaid Program, to 
work this through the structure. A, to have this amendment come to the 
floor, not having gone through the normal process, I think is 
inappropriate; B, this is a Medicare bill, not a Medicaid bill.

[[Page 16607]]

  I say to the Senator from Iowa, I know Senator Grassley has said to 
me he is willing to work with his colleague from Iowa on moving this 
forward. The legislation the Senator from Iowa has put forward has 
merit and will probably receive bipartisan support, but it does not 
belong on this bill.
  So I ask my colleagues--by the way, it is $1.75 billion. I understand 
there is an offset, but this is a Medicare bill and we should defeat 
this amendment.
  I ask unanimous consent that the Senator from Colorado be recognized 
to lay down an amendment.
  The PRESIDENT pro tempore. The Senator from Colorado.
  Mr. ALLARD. Mr. President, I ask that the pending amendment be 
temporarily laid aside.
  The PRESIDENT pro tempore. Without objection, it is so ordered.


                           Amendment No. 1017

  Mr. ALLARD. I send amendment No. 1017 to the desk.
  The PRESIDENT pro tempore. The clerk will report.
  The bill clerk read as follows:

       The Senator from Colorado (Mr. Allard), for himself, Mr. 
     Feingold, Mr. Kohl, and Mr. Leahy, proposes an amendment 
     numbered 1017.

  Mr. ALLARD. Mr. President, I ask unanimous consent that the reading 
of the amendment be dispensed with.
  The PRESIDENT pro tempore. Without objection, it is so ordered.
  The amendment is as follows:

(Purpose: To provide for temporary suspension of OASIS requirement for 
     collection of data on non-medicare and non-medicaid patients)

       At the end of title VI, insert the following:

     SEC. __. TEMPORARY SUSPENSION OF OASIS REQUIREMENT FOR 
                   COLLECTION OF DATA ON NON-MEDICARE AND NON-
                   MEDICAID PATIENTS.

       (a) In General.--During the period described in subsection 
     (b), the Secretary may not require, under section 4602(e) of 
     the Balanced Budget Act of 1997 or otherwise under OASIS, a 
     home health agency to gather or submit information that 
     relates to an individual who is not eligible for benefits 
     under either title XVIII or title XIX of the Social Security 
     Act (such information in this section referred to as ``non-
     medicare/medicaid OASIS information'').
       (b) Period of Suspension.--The period described in this 
     subsection--
       (1) begins on the date of the enactment of this Act; and
       (2) ends on the last day of the 2nd month beginning after 
     the date as of which the Secretary has published final 
     regulations regarding the collection and use by the Centers 
     for Medicare & Medicaid Services of non-medicare/medicaid 
     OASIS information following the submission of the report 
     required under subsection (c).
       (c) Report.--
       (1) Study.--The Secretary shall conduct a study on how non-
     medicare/medicaid OASIS information is and can be used by 
     large home health agencies. Such study shall examine--
       (A) whether there are unique benefits from the analysis of 
     such information that cannot be derived from other 
     information available to, or collected by, such agencies; and
       (B) the value of collecting such information by small home 
     health agencies compared to the administrative burden related 
     to such collection.

     In conducting the study the Secretary shall obtain 
     recommendations from quality assessment experts in the use of 
     such information and the necessity of small, as well as 
     large, home health agencies collecting such information.
       (2) Report.--The Secretary shall submit to Congress a 
     report on the study conducted under paragraph (1) by not 
     later than 18 months after the date of the enactment of this 
     Act.
       (d) Construction.--Nothing in this section shall be 
     construed as preventing home health agencies from collecting 
     non-medicare/medicaid OASIS information for their own use.

  Mr. ALLARD. Mr. President, Medicare home health providers are in a 
paperwork crisis. Current regulations of the Centers for Medicare and 
Medicaid Services, CMS, requires that caregivers administer voluminous 
paperwork to patients when they administer care.
  These paperwork requirements are too excessive for both patients and 
caregivers. Caregivers must administer numerous forms including data 
collection, patient privacy information, a plan of care, advance 
directives, a visit schedule, a comprehensive assessment, and more.
  One of these requirements, called OASIS, or the Outcome and 
Assessment Information Set, is 94 questions long and takes a few hours 
to fill out. Before a nurse or physical therapist administers care, she 
and the patient must sit down and answer questions and fill out this 
paperwork. Colorado providers have told me they spend more time filling 
out paperwork than they do caring for patients.
  As a result of this excessive data collection and dissemination, home 
health caregivers are leaving the home health industry. Two weeks ago a 
home health administrator in Colorado Springs came to share with me the 
situation in her agency. On her plane trip here, three of her newly-
home health physical therapists called to tell her they were leaving 
the agency because of excessive paperwork requirements. They said they 
were going to leave the home health industry and return to the hospital 
industry.
  We cannot afford this. Home health care is a vital player in health 
care for seniors and all individuals. If this paperwork crisis 
continues, home health care will continue to lose caregivers and bloat 
its current caregiver shortage.
  Currently CMS requires that home health caregivers administer OASIS 
to Medicare patients, to Medicaid patients, and to patients who have 
private health insurance. The problem with this regulation, however, is 
that the data collected for private health insurance patients is not 
even used. This data literally sits in the offices of home health 
agencies with no current purpose.
  The fact is CMS requires that home health agencies encode the OASIS 
data for Medicare and Medicaid patients only and to transmit it to 
their States. Then the information is transmitted into the Federal 
OASIS Repository.
  For all private insurance patients, the home health agencies do not 
have to encode or transmit the data. So these nurses, physical 
therapists, occupational therapists, and nurse practitioners are 
required to collect this data for no reason.
  It is my understanding CMS intends to require the transmission of 
data for private health patients at some point. But it has been 4 years 
and they have not done it yet.
  In the meantime there are still many problems with OASIS. Until CMS 
issues the improved regulation, caregivers should be allowed to stop 
collecting unused data that ends up in the filing cabinets of home 
health agencies.
  The amendment I am offering with Senators Feingold, Collins, Kohl, 
and Leahy would suspend the CMS requirement of collecting OASIS data 
for private insurance patients, non-Medicare and non-Medicaid patients, 
until an outcome by CMS's two OASIS working groups is reached.
  Specifically, OASIS would be suspended until the 2 months immediately 
after HHS issues its regulations about OASIS. The regulations will be 
based on the information collected from and the recommendations of 
CMS's two working groups that are determining over the course of 3 
years ways to improve OASIS data collection and quality assurance.
  Our amendment is supported by caregivers in home health who 
administer OASIS, including physical therapists, nurses, nurse 
practitioners, occupational therapists, and speech therapists. 
Congresswoman Nancy Johnson, chairwoman of the Oversight Subcommittee 
of the House Committee on Ways and Means, also strongly supports this 
amendment. In addition, our language was included in Medicare reform 
bills in the Senate in the last 2 consecutive years. Further, I commend 
Senator Feingold for introducing legislation last Congress to reform 
OASIS and I commend Senator Murkowski and Senator Kerry for their work 
on the MARCIA regulatory reform legislation, which included an OASIS 
suspension.
  My colleagues and I believe OASIS data collection is helpful and 
should be applied. Even providers and patients, who must comply with 
the law, believe this. Yet the requirements to collect data should be 
achievable and inexcessive.
  I am pleased to offer this amendment and urge my colleagues to 
support this effort for caregivers and patients.
  Mr. ALLARD. Mr. President, I ask unanimous consent that the two 
additional cosponsors be added to the

[[Page 16608]]

amendment, Senator Kohl and Senator Leahy.
  The PRESIDENT pro tempore. Without objection, it is so ordered.
  The Senator from Pennsylvania.


                       Vote on Amendment No. 991

  Mr. SANTORUM. Mr. President, I move to table the Harkin amendment and 
ask for the yeas and nays.
  The PRESIDENT pro tempore. Is there a sufficient second?
  There is a sufficient second.
  The question is on agreeing to the motion.
  The clerk will call the roll.
  The legislative clerk called the roll.
  Mr. REID, I announce that the Senator from Massachusetts (Mr. Kerry) 
and the Senator from Connecticut (Mr. Lieberman) are necessarily 
absent.
  I further announce that, if present and voting, the Senator from 
Massachusetts (Mr. Kerry) would each vote ``nay''.
  The PRESIDING OFFICER (Ms. Murkowski). Are there any other Senators 
in the Chamber desiring to vote?
  The result was announced--yeas 50, nays 48, as follows:

                      [Rollcall Vote No. 247 Leg.]

                                YEAS--50

     Alexander
     Allard
     Allen
     Baucus
     Bennett
     Bond
     Breaux
     Brownback
     Bunning
     Burns
     Campbell
     Chafee
     Chambliss
     Cochran
     Coleman
     Collins
     Cornyn
     Craig
     Crapo
     DeWine
     Dole
     Domenici
     Enzi
     Fitzgerald
     Frist
     Graham (SC)
     Grassley
     Gregg
     Hagel
     Hatch
     Hutchison
     Inhofe
     Kyl
     Lott
     Lugar
     McCain
     McConnell
     Murkowski
     Nickles
     Roberts
     Santorum
     Sessions
     Shelby
     Snowe
     Stevens
     Sununu
     Talent
     Thomas
     Voinovich
     Warner

                                NAYS--48

     Akaka
     Bayh
     Biden
     Bingaman
     Boxer
     Byrd
     Cantwell
     Carper
     Clinton
     Conrad
     Corzine
     Daschle
     Dayton
     Dodd
     Dorgan
     Durbin
     Edwards
     Ensign
     Feingold
     Feinstein
     Graham (FL)
     Harkin
     Hollings
     Inouye
     Jeffords
     Johnson
     Kennedy
     Kohl
     Landrieu
     Lautenberg
     Leahy
     Levin
     Lincoln
     Mikulski
     Miller
     Murray
     Nelson (FL)
     Nelson (NE)
     Pryor
     Reed
     Reid
     Rockefeller
     Sarbanes
     Schumer
     Smith
     Specter
     Stabenow
     Wyden

                             NOT VOTING--2

       
     Kerry
       
     Lieberman
  The motion was agreed to.
  Mr. SANTORUM. Madam President, I move to reconsider the vote.
  Mr. GRASSLEY. I move to lay that motion on the table.
  The motion to lay on the table was agreed to.


                           Amendment No. 1052

  Mr. BAUCUS. Madam President, will the Chair state the regular order?
  The PRESIDING OFFICER. There will be 2 minutes evenly divided before 
the vote on the next amendment.
  Mr. BAUCUS. I thank the Chair.
  The PRESIDING OFFICER. Who yields time?
  Mr. BAUCUS. The Senator from North Carolina.
  Mr. EDWARDS. Madam President, yesterday we voted on the Edwards-
Harkin amendment which had two provisions. The first provision dealt 
with the FDA approval process for ``me too'' drugs. There were concerns 
expressed by the Members of the Senate about that provision. Even 
though I disagreed with those concerns, I don't think it would have 
slowed down the FDA approval process. Because of those concerns, we 
have removed those provisions from this amendment.
  The amendment we are about to vote on deals only with advertising. It 
in no way bans advertising. All this amendment does is require that the 
advertising engaged in by drug companies and pharmaceutical companies 
be evenhanded. The only thing this amendment requires is that the 
information be accurate and evenhanded. In other words, you can't have 
kids dancing in a field as the image on television and in small print 
at the bottom saying the drug can cause strokes or have other side 
effects.
  We want to make sure the American people in these advertisements get 
accurate information and which is not misleading. This amendment does 
exactly that. We have eliminated the provision so many were concerned 
about yesterday.
  I urge my colleagues to support this amendment. Let us make sure the 
American people get true and accurate information in the advertising 
they are seeing on drugs on television.
  The PRESIDING OFFICER. Who yields time?
  Mr. ENZI. Madam President, I rise in opposition to this amendment 
submitted by my colleague from North Carolina, Senator Edwards. 
Yesterday, the Senate defeated an amendment offered by my colleague 
that would have restricted direct-to-consumer advertising of 
prescription medicines.
  This new amendment continues this effort by offering similar 
advertising provisions to those already defeated.
  I have a list of 14 organizations which I ask unanimous consent be 
printed in the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                                                    June 26, 2003.
     To: Members of the United States Senate:
       The undersigned organizations are writing in opposition to 
     the amendment offered by Senator Edwards regarding changes to 
     Direct to Consumer advertising of pharmaceutical products. 
     This amendment would impose serious restrictions on 
     information which is of considerable value to the millions of 
     patients we represent.
       Our organizations are advocates for millions of Americans 
     who suffer from a broad range of illnesses. Early detection 
     and treatment of these illnesses is an important factor in 
     helping those individuals lead longer and healthier lives. 
     Communication, public education and awareness are key 
     components in the outcomes American patients can hope to 
     achieve. Limiting access to credible information is bad 
     healthcare policy and we urge you to oppose the Edwards 
     amendment and any other efforts to deny Americans 
     information.
           Respectfully,
       The National Alliance for the Mentally Ill.
       The National Mental Health Association.
       The American Association of Diabetes Educators.
       The American Foundation for Urologic Disease.
       The American Lung Foundation.
       The National Health Council.
       The Interamerican College of Physicians and Surgeons.
       The Kidney Cancer Association.
       The Society for Womens Health Research.
       The National Headache Foundation.
       The National Coalition for Women with Heart Disease.
       The National Osteoporosis Foundation.
       The American Liver Foundation.
       The National Stroke Association.

  Mr. ENZI. Madam President, these are organizations that are advocates 
for millions of Americans who suffer from a broad range of illnesses. 
Early detection and treatment of these illnesses is more communication. 
Public education and awareness are key components. Advertising is the 
key component of it.
  This amendment would require the Secretary of Health and Human 
Services to promulgate new rules that would require advertisements to 
provide information about a drug's effectiveness in comparison to other 
drugs for ``substantially the same condition.'' In other words, you 
have to advertise with your competitors as well. The unfortunate effect 
would be to make the advertisements even more complex, not less, for 
consumers. It would force ads to drop other information that would be 
beneficial to consumers.
  I ask that you reject the amendment.
  The PRESIDING OFFICER. The question is on agreeing to the amendment.
  Mr. SANTORUM. Madam President, I ask for the yeas and nays.
  The PRESIDING OFFICER. Is there a sufficient second?
  There is a sufficient second.
  The clerk will call the roll.
  The bill clerk called the roll.
  Mr. REID. I announce that the Senator from Massachusetts (Mr. Kerry) 
and the Senator from Connecticut (Mr. Lieberman) are necessarily 
absent.
  I further announce that, if present and voting, the Senator from 
Massachusetts (Mr. Kerry) would vote ``Yea''.
  The PRESIDING OFFICER. Are there any other Senators in the Chamber 
desiring to vote?
  The result was announced--yeas 39, nays 59, as follows:

[[Page 16609]]



                      [Rollcall Vote No. 248 Leg.]

                                YEAS--39

     Akaka
     Bayh
     Bingaman
     Boxer
     Byrd
     Cantwell
     Clinton
     Conrad
     Corzine
     Daschle
     Dayton
     Dodd
     Dorgan
     Durbin
     Edwards
     Feingold
     Feinstein
     Graham (FL)
     Harkin
     Inouye
     Johnson
     Kennedy
     Kohl
     Landrieu
     Leahy
     Levin
     Lincoln
     Mikulski
     Miller
     Murray
     Nelson (FL)
     Pryor
     Reed
     Reid
     Rockefeller
     Sarbanes
     Schumer
     Stabenow
     Wyden

                                NAYS--59

     Alexander
     Allard
     Allen
     Baucus
     Bennett
     Biden
     Bond
     Breaux
     Brownback
     Bunning
     Burns
     Campbell
     Carper
     Chafee
     Chambliss
     Cochran
     Coleman
     Collins
     Cornyn
     Craig
     Crapo
     DeWine
     Dole
     Domenici
     Ensign
     Enzi
     Fitzgerald
     Frist
     Graham (SC)
     Grassley
     Gregg
     Hagel
     Hatch
     Hollings
     Hutchison
     Inhofe
     Jeffords
     Kyl
     Lautenberg
     Lott
     Lugar
     McCain
     McConnell
     Murkowski
     Nelson (NE)
     Nickles
     Roberts
     Santorum
     Sessions
     Shelby
     Smith
     Snowe
     Specter
     Stevens
     Sununu
     Talent
     Thomas
     Voinovich
     Warner

                             NOT VOTING--2

     Kerry
     Lieberman
       
  The amendment (No. 1052) was rejected.
  Mr. GRASSLEY. Madam President, I move to reconsider the vote.
  Mr. BAUCUS. I move to lay that motion on the table.
  The motion to lay on the table was agreed to.


                    Amendment No. 1092, As Modified

  Mr. GRASSLEY. Madam President, I send to the desk a modification of 
the Grassley benchmark amendment filed last night. I ask that I have a 
right to modify my amendment.
  The PRESIDING OFFICER. Without objection, the amendment is modified. 
It is not the pending amendment at this time.
  The modification is as follows:

       At the end of subtitle C of title II, add the following:

   Subtitle D--Evaluation of Alternative Payment and Delivery Systems

     SEC. 231. ESTABLISHMENT OF ALTERNATIVE PAYMENT SYSTEM FOR 
                   PREFERRED PROVIDER ORGANIZATIONS IN HIGHLY 
                   COMPETITIVE REGIONS.

       (a) Establishment of Alternative Payment System for 
     Preferred Provider Organizations in Highly Competitive 
     Regions.--Section 1858 (as added by section 211(b)) is 
     amended by adding at the end the following new subsection:
       ``(i) Alternative Payment Methodology for Highly 
     Competitive Regions.--
       ``(1) Annual determination and designation.--
       ``(A) In 2008.--In 2008, prior to the date on which the 
     Secretary expects to publish the risk adjusters under section 
     1860D-11, the Secretary shall designate a limited number (but 
     in no case fewer than 1) of preferred provider regions (other 
     than the region described in subsection (a)(2)(C)(ii)) as 
     highly competitive regions.
       ``(B) Subsequent years.--For each year (beginning with 
     2009) the Secretary may designate a limited number of 
     preferred provider regions (other than the region described 
     in subsection (a)(2)(C)(ii)) as highly competitive regions in 
     addition to any region designated as a highly competitive 
     region under subparagraph (A).
       ``(C) Considerations.--In determining which preferred 
     provider regions to designate as highly competitive regions 
     under subparagraph (A) or (B), the Secretary shall consider 
     the following:
       ``(i) Whether the application of this subsection to the 
     preferred provider region would enhance the participation of 
     preferred provider organization plans in that region.
       ``(ii) Whether the Secretary anticipates that there is 
     likely to be at least 3 bids submitted under subsection 
     (d)(1) with respect to the preferred provider region if the 
     Secretary designates such region as a highly competitive 
     region under subparagraph (A) or (B).
       ``(iii) Whether the Secretary expects that 
     MedicareAdvantage eligible individuals will elect preferred 
     provider organization plans in the preferred provider region 
     if the region is designated as a highly competitive region 
     under subparagraph (A) or (B).
       ``(iv) Whether the designation of the preferred provider 
     region as a highly competitive region will permit compliance 
     with the limitation described in paragraph (5).

     In considering the matters described in clauses (i) through 
     (iv), the Secretary shall give special consideration to 
     preferred provider regions where no bids were submitted under 
     subsection (d)(1) for the previous year.
       ``(2) Effect of designation.--If a preferred provider 
     region is designated as a highly competitive region under 
     subparagraph (A) or (B) of paragraph (1)--
       ``(A) the provisions of this subsection shall apply to such 
     region and shall supersede the provisions of this part 
     relating to benchmarks for preferred provider regions; and
       ``(B) such region shall continue to be a highly competitive 
     region until such designation is rescinded pursuant to 
     paragraph (5)(B)(ii).
       ``(3) Submission of bids.--
       ``(A) In general.--Notwithstanding subsection (d)(1), for 
     purposes of applying section 1854(a)(2)(A)(i), the plan bid 
     for a highly competitive region shall consist of a dollar 
     amount that represents the total amount that the plan is 
     willing to accept (not taking into account the application of 
     the comprehensive risk adjustment methodology under section 
     1853(a)(3)) for providing coverage of only the benefits 
     described in section 1852(a)(1)(A) to an individual enrolled 
     in the plan that resides in the service area of the plan for 
     a month.
       ``(B) Construction.--Nothing in subparagraph (A) shall be 
     construed as permitting a preferred provider organization 
     plan not to provide coverage for the benefits described in 
     section 1852(a)(1)(C).
       ``(4) Payments to preferred provider organizations in 
     highly competitive areas.--With respect to highly competitive 
     regions, the following rules shall apply:
       ``(A) In general.--Notwithstanding subsection (c), of the 
     plans described in subsection (d)(1)(E), the Secretary shall 
     substitute the second lowest bid for the benchmark applicable 
     under subsection (c)(4).
       ``(B) If there are fewer than three bids.--Notwithstanding 
     subsection (c), if there are fewer than 3 bids in a highly 
     competitive region for a year, the Secretary shall substitute 
     the lowest bid for the benchmark applicable under subsection 
     (c)(4).
       ``(5) Funding limitation.--
       ``(A) In general.--
       ``(i) In general.--The total amount expended as a result of 
     the application of this subsection during the period or year, 
     as applicable, may not exceed the applicable amount (as 
     defined in clause (ii)).
       ``(ii) Applicable amount defined.--In this paragraph, the 
     term `applicable amount' means--

       ``(I) for the period beginning on January 1, 2009, and 
     ending on September 30, 2013, the total amount that would 
     have been expended under this title during the period if this 
     subsection had not been enacted plus $6,000,000,000; and
       ``(II) for fiscal year 2014 and any subsequent fiscal year, 
     the total amount that would have been expended under this 
     title during the year if this subsection had not been 
     enacted.

       ``(B) Application of limitation.--If the Secretary 
     determines that the application of this subsection will cause 
     expenditures to exceed the applicable amount, the Secretary 
     shall--
       ``(i) take appropriate steps to stay within the applicable 
     amount, including through providing limitations on 
     enrollment; or
       ``(ii) rescind the designation under subparagraph (A) or 
     (B) of paragraph (1) of 1 or more preferred provider regions 
     as highly competitive regions.
       ``(C) Transition.--If the Secretary rescinds a designation 
     under subparagraph (A) or (B) of paragraph (1) pursuant to 
     subparagraph (B)(ii) with respect to a preferred provider 
     region, the Secretary shall provide for an appropriate 
     transition from the payment system applicable under this 
     subsection to the payment system described in the other 
     provisions of this section in that region. Any amount 
     expended by reason of the preceding sentence shall be 
     considered to be part of the total amount expended as a 
     result of the application of this subsection for purposes of 
     applying the limitation under subparagraph (A).
       ``(D) Application.--Notwithstanding paragraph (1)(B), on or 
     after January 1 of the year in which the fiscal year 
     described in subparagraph (A)(ii)(II) begins, the Secretary 
     may designate appropriate regions under such paragraph.
       ``(6) Limitation of judicial review.--There shall be no 
     administrative or judicial review under section 1869, section 
     1878, or otherwise, of designations made under subparagraph 
     (A) or (B) of paragraph (1).
       ``(7) Secretary reports.--Not later than April 1 of each 
     year (beginning in 2010), the Secretary shall submit a report 
     to Congress and the Comptroller General of the United States 
     that includes--
       ``(A) a detailed description of--
       ``(i) the total amount expended as a result of the 
     application of this subsection in the previous year compared 
     to the total amount that would have been expended under this 
     title in the year if this subsection had not been enacted;
       ``(ii) the projections of the total amount that will be 
     expended as a result of the application of this subsection in 
     the year in which the report is submitted compared to the 
     total amount that would have been expended under this title 
     in the year if this subsection had not been enacted;
       ``(iii) amounts remaining within the funding limitation 
     specified in paragraph (5); and
       ``(iv) the steps that the Secretary will take under clauses 
     (i) and (ii) of paragraph (5)(B)

[[Page 16610]]

     to ensure that the application of this subsection will not 
     cause expenditures to exceed the applicable amount described 
     in paragraph (5)(A); and
       ``(B) a certification from the Chief Actuary of the Centers 
     for Medicare & Medicaid Services that the descriptions under 
     clauses (i), (ii), (iii), and (iv) of subparagraph (A) are 
     reasonable, accurate, and based on generally accepted 
     actuarial principles and methodologies.
       ``(8) Biennial gao reports.--Not later than January 1, 
     2011, and biennially thereafter, the Comptroller General of 
     the United States shall submit to the Secretary and Congress 
     a report on the designation of highly competitive regions 
     under this subsection and the application of the payment 
     system under this subsection within such regions. Each report 
     shall include--
       ``(A) an evaluation of--
       ``(i) the quality of care provided to beneficiaries 
     enrolled in a MedicareAdvantage preferred provider plan in a 
     highly competitive region;
       ``(ii) the satisfaction of beneficiaries with benefits 
     under such a plan;
       ``(iii) the costs to the medicare program for payments made 
     to such plans; and
       ``(iv) any improvements in the delivery of health care 
     services under such a plan;
       ``(B) a comparative analysis of the benchmark system 
     applicable under the other provisions of this section and the 
     payment system applicable in highly competitive regions under 
     this subsection; and
       ``(C) recommendations for such legislation or 
     administrative action as the Comptroller General determines 
     to be appropriate.
       ``(9) Report on budget neutrality for fiscal years after 
     2013.--
       ``(A) In general.--If the Secretary intends to designate 1 
     or more regions as highly competitive regions with respect to 
     calendar 2014 or any subsequent calendar year, the Secretary 
     shall submit a report to Congress indicating such intent no 
     later than April 1 of the calendar year prior to the calendar 
     year in which the applicable designation year begins.
       ``(B) Requirements.--A report submitted under subparagraph 
     (A) shall--
       ``(i) specify the steps (if any) that the Secretary will 
     take pursuant to paragraph (5)(B) to ensure that the total 
     amount expended as a result of the application of this 
     subsection during the year will not exceed the applicable 
     amount for the year (as defined in paragraph (5)(A)(ii)(II)); 
     and
       ``(ii) contain a certification from the Chief Actuary of 
     the Centers for Medicare and Medicaid Services that such 
     steps will meet the requirements of paragraph (5)(A) based on 
     an analysis using generally accepted actuarial principles and 
     methodologies.''.
       (b) Conforming Amendment.--Section 1858(c)(3)(A)(i) (as 
     added by section 211(b)) is amended to read as follows:
       ``(i) Whether each preferred provider region has been 
     designated as a highly competitive region under subparagraph 
     (A) or (B) of subsection (i)(1) and the benchmark amount for 
     any preferred provider region (as calculated under paragraph 
     (2)(A)) for the year that has not been designated as a highly 
     competitive region.''.

     SEC. 232. FEE-FOR-SERVICE MODERNIZATION PROJECTS.

       (a) Establishment.--
       (1) Review and report on results of existing 
     demonstrations.--
       (A) Review.--The Secretary shall conduct an empirical 
     review of the results of the demonstrations under sections 
     442, 443, and 444.
       (B) Report.--Not later than January 1, 2008, the Secretary 
     shall submit a report to Congress on the empirical review 
     conducted under subparagraph (A) which shall include 
     estimates of the total costs of the demonstrations, including 
     expenditures as a result of the provision of services 
     provided to beneficiaries under the demonstrations that are 
     incidental to the services provided under the demonstrations, 
     and all other expenditures under title XVIII of the Social 
     Security Act. The report shall also include a certification 
     from the Chief Actuary of the Centers for Medicare & Medicaid 
     Services that such estimates are reasonable, accurate, and 
     based on generally accepted actuarial principles and 
     methodologies.
       (2) Projects.--Beginning in 2009, the Secretary, based on 
     the empirical review conducted under paragraph (1), shall 
     establish projects under which medicare beneficiaries 
     receiving benefits under the medicare fee-for-service program 
     under parts A and B of title XVIII of the Social Security Act 
     are provided with coverage of enhanced benefits or services 
     under such program. The purpose of such projects is to 
     evaluate whether the provision of such enhanced benefits or 
     services to such beneficiaries--
       (A) improves the quality of care provided to such 
     beneficiaries under the medicare program;
       (B) improves the health care delivery system under the 
     medicare program; and
       (C) results in reduced expenditures under the medicare 
     program.
       (2) Enhanced benefits or services.--For purposes of this 
     section, enhanced benefits or services shall include--
       (A) preventive services not otherwise covered under title 
     XVIII of the Social Security Act;
       (B) chronic care coordination services;
       (C) disease management services; or
       (D) other benefits or services that the Secretary 
     determines will improve preventive health care for medicare 
     beneficiaries, result in improved chronic disease management, 
     and management of complex, life-threatening, or high-cost 
     conditions and are consistent with the goals described in 
     subparagraphs (A), (B), and (C) of paragraph (1).
       (b) Project Sites and Duration.--
       (1) In general.--Subject to subsection (e)(2), the projects 
     under this section shall be conducted--
       (A) in a region or regions that are comparable (as 
     determined by the Secretary) to the region or regions that 
     are designated as a highly competitive region under 
     subparagraph (A) or (B) of section 1858(i)(1) of the Social 
     Security Act, as added by section 231 of this Act; and
       (B) during the years that a region or regions are 
     designated as such a highly competitive region.
       (2) Rule of construction.--For purposes of paragraph (1), a 
     comparable region does not necessarily mean the identical 
     region.
       (c) Waiver Authority.--The Secretary shall waive compliance 
     with the requirements of title XVIII of the Social Security 
     Act (42 U.S.C. 1395 et seq.) only to the extent and for such 
     period as the Secretary determines is necessary to provide 
     for enhanced benefits or services consistent with the 
     projects under this section.
       (d) Biennial GAO Reports.--Not later than January 1, 2011, 
     and biennially thereafter for as long as the projects under 
     this section are being conducted, the Comptroller General of 
     the United States shall submit to the Secretary and Congress 
     a report that evaluates the projects. Each report shall 
     include--
       (1) an evaluation of--
       (A) the quality of care provided to beneficiaries receiving 
     benefits or services under the projects;
       (B) the satisfaction of beneficiaries receiving benefits or 
     services under the projects;
       (C) the costs to the medicare program under the projects; 
     and
       (D) any improvements in the delivery of health care 
     services under the projects; and
       (2) recommendations for such legislation or administrative 
     action as the Comptroller General determines to be 
     appropriate.
       (e) Funding.--
       (1) In general.--Payments for the costs of carrying out the 
     projects under this section shall be made from the Federal 
     Hospital Insurance Trust Fund under section 1817 of the 
     Social Security Act (42 U.S.C. 1395i) and the Federal 
     Supplementary Insurance Trust Fund under section 1841 of such 
     Act (42 U.S.C. 1395t), as determined appropriate by the 
     Secretary.
       (2) Limitation.--The total amount expended under the 
     medicare fee-for-service program under parts A and B of title 
     XVIII of the Social Security Act (including all amounts 
     expended as a result of the projects under this section) 
     during the period or year, as applicable, may not exceed--
       (A) for the period beginning on January 1, 2009, and ending 
     on September 30, 2013, an amount equal to the total amount 
     that would have been expended under the medicare fee-for-
     service program under parts A and B of title XVIII of the 
     Social Security Act during the period if the projects had not 
     been conducted plus $6,000,000,000; and
       (B) for fiscal year 2014 and any subsequent fiscal year, an 
     amount equal to the total amount that would have been 
     expended under the medicare fee-for-service program under 
     parts A and B of such title during the year if the projects 
     had not been conducted.
       (3) Monitoring and reports.--
       (A) Ongoing monitoring by the secretary to ensure funding 
     limitation is not violated.--The Secretary shall continually 
     monitor expenditures made under title XVIII of the Social 
     Security Act by reason of the projects under this section to 
     ensure that the limitations described in subparagraphs (A) 
     and (B) of paragraph (2) are not violated.
       (B) Reports.--Not later than April 1 of each year 
     (beginning in 2010), the Secretary shall submit a report to 
     Congress and the Comptroller General of the United States 
     that includes--
       (i) a detailed description of--

       (I) the total amount expended under the medicare fee-for-
     service program under parts A and B of title XVIII of the 
     Social Security Act (including all amounts expended as a 
     result of the projects under this section) during the 
     previous year compared to the total amount that would have 
     been expended under the original medicare fee-for-service 
     program in the year if the projects had not been conducted;
       (II) the projections of the total amount expended under the 
     medicare fee-for-service program under parts A and B of title 
     XVIII of the Social Security Act (including all amounts 
     expended as a result of the projects under this section) 
     during the year in which the report is submitted compared to 
     the total amount that would have been expended under the 
     original medicare fee-for-service program in the year if the 
     projects had not been conducted;
       (III) amounts remaining within the funding limitation 
     specified in paragraph (2); and
       (IV) how the Secretary will change the scope, site, and 
     duration of the projects in

[[Page 16611]]

     subsequent years in order to ensure that the limitations 
     described in subparagraphs (A) and (B) of paragraph (2) are 
     not violated; and

       (ii) a certification from the Chief Actuary of the Centers 
     for Medicare & Medicaid Services that the descriptions under 
     subclauses (I), (II), (III), and (IV) of clause (i) are 
     reasonable, accurate, and based on generally accepted 
     actuarial principles and methodologies.
       (C) Report on budget neutrality for fiscal years after 
     2013.--
       (i) In general.--If the Secretary intends to continue the 
     projects under this section for fiscal year 2014 or any 
     subsequent fiscal year, the Secretary shall submit a report 
     to Congress indicating such intent no later than April 1 of 
     the year prior to the year in which the fiscal year begins.
       (ii) Requirements.--A report submitted under clause (i) 
     shall--

       (I) specify the steps (if any) that the Secretary will take 
     pursuant to paragraph (4) to ensure that the limitations 
     described in paragraph (2)(B) will not be violated for the 
     year; and
       (II) contain a certification from the Chief Actuary of the 
     Centers for Medicare and Medicaid Services that such steps 
     will meet the requirements of paragraph (2) based on an 
     analysis using generally accepted actuarial principles and 
     methodologies.

       (4) Application of Limitation.--If the Secretary determines 
     that the projects under this section will cause the 
     limitations described in subparagraphs (A) and (B) of 
     paragraph (2) to be violated, the Secretary shall take 
     appropriate steps to reduce spending under the projects, 
     including through reducing the scope, site, and duration of 
     the projects.
       (5) Authority.--Beginning in 2014, the Secretary shall make 
     necessary spending adjustments (including pro rata reductions 
     in payments to health care providers under the medicare 
     program) to recoup amounts so that the limitations described 
     in subparagraphs (A) and (B) of paragraph (2) are not 
     violated.

  Mr. BAUCUS. Mr. President, on behalf of Senator Conrad, I ask 
unanimous consent that a letter from the Congressional Budget Office be 
printed in the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                                                    U.S. Congress,


                                  Congressional Budget Office,

                                    Washington, DC, June 26, 2003.
     Hon. Kent Conrad,
     Ranking Member, Committee on the Budget,
     U.S. Senate, Washington, DC.
       Dear Senator: The Congressional Budget Office has reviewed 
     a proposed amendment (GOE03.597) by Senators Grassley and 
     Baucus to S. 1, a bill to amend title XVIII of the Social 
     Security Act to make improvements in the Medicare program, to 
     provide prescription drug coverage under the Medicare 
     program, and for other purposes. That amendment would add 
     subtitle D to title II, establishing an alternative payment 
     system for preferred provider organizations in highly 
     competitive regions and fee-for-service modernization 
     projects.
       CBO estimates that the amendment would add $12 billion in 
     outlays to the cost of the bill over the 2009-2013 period--$6 
     billion for payments to preferred provider organizations and 
     $6 billion for the fee-for-service modernization projects. 
     The amendment would allow the programs to continue after 
     2013, but under the rules the amendment specifies for the 
     Secretary of Health and Human Services, CBO estimates that 
     those programs would incur no additional net costs after that 
     time.
       If you wish further details on this estimate, we will be 
     pleased to provide them.
           Sincerely,
                                                Robert A. Sunshine
                              (For Douglas Holtz-Eakin, Director.)

  Mr. GRASSLEY. Madam President, I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The legislative clerk proceeded to call the roll.
  Mr. BAUCUS. Madam President, I ask unanimous consent that the order 
for the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.


                           Amendment No. 1054

  Mr. BAUCUS. Madam President, I ask unanimous consent that all pending 
amendments be set aside so that I might call up amendment No. 1054 on 
behalf of Senator Feingold, with respect to Medicare beneficiaries.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The clerk will report.
  The legislative clerk read as follows:

       The Senator from Montana [Mr. Baucus], for Mr. Feingold, 
     proposes an amendment numbered 1054.

  Mr. BAUCUS. Madam President, I ask unanimous consent that further 
reading of the amendment be dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The amendment is as follows:

 (Purpose: To establish an Office of the Medicare Beneficiary Advocate)

       At the end of subtitle D of title I, add the following:

     SEC. 133. OFFICE OF THE MEDICARE BENEFICIARY ADVOCATE.

       (a) Establishment.--Not later than 1 year after the date of 
     enactment of this Act, the Secretary shall establish within 
     the Department of Health and Human Services, an Office of the 
     Medicare Beneficiary Advocate (in this section referred to as 
     the ``Office'').
       (b) Duties.--The Office shall carry out the following 
     activities:
       (1) Establishing a toll-free telephone number for medicare 
     beneficiaries to use to obtain information on the medicare 
     program, and particularly with respect to the benefits 
     provided under part D of title XVIII of the Social Security 
     Act and the Medicare Prescription Drug plans and 
     MedicareAdvantage plans offering such benefits. The Office 
     shall ensure that the toll-free telephone number accommodates 
     beneficiaries with disabilities and limited-English 
     proficiency.
       (2) Establishing an Internet website with easily accessible 
     information regarding Medicare Prescription Drug plans and 
     MedicareAdvantage plans and the benefits offered under such 
     plans. The website shall--
       (A) be updated regularly to reflect changes in services and 
     benefits, including with respect to the plans offered in a 
     region and the associated monthly premiums, benefits offered, 
     formularies, and contact information for such plans, and to 
     ensure that there are no broken links or errors;
       (B) have printer-friendly, downloadable fact sheets on the 
     medicare coverage options and benefits;
       (C) be easy to navigate, with large print and easily 
     recognizable links; and
       (D) provide links to the websites of the eligible entities 
     participating in part D of title XVIII.
       (3) Providing regional publications to medicare 
     beneficiaries that include regional contacts for information, 
     and that inform the beneficiaries of the prescription drug 
     benefit options under title XVIII of the Social Security Act, 
     including with respect to--
       (A) monthly premiums;
       (B) formularies; and
       (C) the scope of the benefits offered.
       (4) Conducting outreach to medicare beneficiaries to inform 
     the beneficiaries of the medicare coverage options and 
     benefits under parts A, B, C, and D of title XVIII of the 
     Social Security Act.
       (5) Working with local benefits administrators, ombudsmen, 
     local benefits specialists, and advocacy groups to ensure 
     that medicare beneficiaries are aware of the medicare 
     coverage options and benefits under parts A, B, C, and D of 
     title XVIII of the Social Security Act.
       (c) Funding.--
       (1) Establishment.--Of the amounts authorized to be 
     appropriated under the Secretary's discretion for 
     administrative expenditures, $2,000,000 may be used to 
     establish the Office in accordance with this section.
       (2) Operation.--With respect to each fiscal year occurring 
     after the fiscal year in which the Office is established 
     under this section, the Secretary may use, out of amounts 
     authorized to be appropriated under the Secretary's 
     discretion for administrative expenditures for such fiscal 
     year, such sums as may be necessary to operate the Office in 
     that fiscal year.

  Mr. BAUCUS. Madam President, I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mr. GRASSLEY. Madam President, I ask unanimous consent that the order 
to the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. GRASSLEY. Madam President, I ask that the pending amendments be 
set aside and that the Senator from Washington be recognized for an 
amendment.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The Senator from Washington.


                           Amendment No. 942

  Ms. CANTWELL. Madam President, I ask unanimous consent that amendment 
No. 942 be the pending business.
  The PRESIDING OFFICER. Without objection, it is so ordered. The 
amendment is the pending business.


                     Amendment No. 942, As Modified

  Ms. CANTWELL. Madam President, I ask unanimous consent that the 
amendment be modified with the changes I send to the desk.
  The PRESIDING OFFICER. The Senator has a right to modify her 
amendment. The amendment is so modified.

[[Page 16612]]

  The amendment (No. 942), as modified, is as follows:

       On page 204, after line 22, insert the following:

     SEC. 133. PHARMACY BENEFIT MANAGERS TRANSPARENCY 
                   REQUIREMENTS.

       (a) Medicare.--Subpart 3 of part D of title XVIII of the 
     Social Security Act (as added by section 101) is amended by 
     adding at the end the following new section:


         ``pharmacy benefit managers transparency requirements

       ``Sec. 1860D-27. (a) Prohibition.--
       ``(1) In general.--Notwithstanding any other provision of 
     law, an eligible entity offering a Medicare Prescription Drug 
     plan under this part or a MedicareAdvantage organization 
     offering a MedicareAdvantage plan under part C shall not 
     enter into a contract with any pharmacy benefit manager (in 
     this section referred to as a `PBM') that is owned by a 
     pharmaceutical manufacturing company.
       ``(2) Provision of information.--A PBM that manages 
     prescription drug coverage under this part or part C shall 
     provide the following information, on an annual basis, to the 
     Assistant Attorney General for Antitrust of the Department of 
     Justice and the Inspector General of the Health and Human 
     Services Department:
       ``(A) The aggregate amount of any and all rebates, 
     discounts, administrative fees, promotional allowances, and 
     other payments received or recovered from each pharmaceutical 
     manufacturer.
       ``(B) The amount of payments received or recovered from 
     each pharmaceutical manufacturer for each of the top 50 drugs 
     as measured by volume (as determined by the Secretary).
       ``(C) The percentage differential between the price the PBM 
     pays pharmacies for a drug described in subparagraph (B) and 
     the price the PBM charges a Medicare Prescription Drug Plan 
     or a MedicareAdvantage organization for such drug.
       ``(b) Failure to Disclose.--
       ``(1) Civil penalty.--Any PBM that fails to comply with 
     subsection (a) shall be liable for a civil penalty as 
     determined appropriate through regulations promulgated by the 
     Attorney General. Such penalty may be recovered in a civil 
     action brought by the United States.
       ``(2) Compliance and equitable relief.--If any PBM fails to 
     comply with subsection (a), the United States district court 
     may order compliance, and may grant such other equitable 
     relief as the court in its discretion determines necessary or 
     appropriate, upon application of the Assistant Attorney 
     General.
       ``(c) Disclosure Exemption.--Any information filed with the 
     Assistant Attorney General under subsection (a)(2) shall be 
     exempt from disclosure under section 552 of title 5, and no 
     such information may be made public, except as may be 
     relevant to any administrative or judicial action or 
     proceeding. Nothing in this section is intended to prevent 
     disclosure to either body of Congress or to any duly 
     authorized committee or subcommittee of the Congress.''.

  Ms. CANTWELL. Madam President, I rise today to offer the Cantwell-
Lincoln Prescription drug transparency amendment to S. 1, the medicare 
prescription drug bill. I thank my cosponsor, Senator Lincoln, for 
working with me on this important amendment that will help protect 
consumers against high prescription drug prices.
  This amendment does three things.
  First, it requires any PBM contracting with Medicare to disclose to 
the Department of Justice how much of the rebates and discounts 
negotiated for Medicare are being passed back.
  Second, the disclosure of these financial arrangements to the 
Department of Justice provides an incentive for PBMs to return as much 
of that savings as possible to Medicare, which will in turn, help 
reduce the high cost of prescription drugs.
  Finally, it prohibits a pharmaceutical company from owning a pharmacy 
benefit manager, an inherent conflict of interest.
  By requiring transparency, the Cantwell-Lincoln amendment works to 
prevent collusion on pricing and helps ensure seniors are not paying 
unnecessarily high prices for their medications.
  PBMs have been the target of numerous lawsuits filed in recent years 
by health plans, employers and governments. The allegations in these 
lawsuits are always the same: overinflated drug prices, price collusion 
between PBMs and manufacturers, failure of PBMs to share discounts and 
rebates, and switching patients to more expensive drugs without the 
consent of the patient or the doctor.
  The PBMs have denied wrongdoing and have settled in many cases.
  Last year, Merck agreed to pay $42.5 million to settle lawsuits over 
allegations that Medco improperly promoted higher priced Merck drugs 
when less expensive options from other pharmaceutical companies were 
available.
  In 1998, Merck signed a settlement agreement with the Federal Trade 
Commission stating that, ``Medco has given favorable treatment to Merck 
drugs.''
  This admission is proof that pharmaceutical companies and PBMs have 
engaged in collusion on drug pricing in the past, extracting excessive 
profits from people who rely on these drug services. The Cantwell-
Lincoln amendment is needed to help prevent price gouging in the 
future.
  Other governments have struggled to keep a close watch on PBM 
practices.
  In 2000, one of the big four PBMs, Advance PCS, was hired by the 
state of Arkansas to provide coverage for the state's 135,000 
employees. A recent audit found that the PBM was over charging the 
state for numerous drugs. During one 4-month period, the PBM 
overcharged the state $479,000 on generic drugs alone.
  PBM executives say that my amendment makes turning a profit 
impossible. It is true that PBMs are not charities but private 
companies with a duty to their shareholders to earn a profit.
  Let's not forget, however, that these are also private companies 
charged with providing a Government-funded benefit in the best 
interests of 40 million senior citizens. These private companies also 
are duty bound to get the most for the Government's $400 billion 
investment.
  Traveling in my home State of Washington, I hear regularly from 
senior citizens about the high cost of prescription drugs. While 
seniors in my State, like elsewhere in the country, want a Medicare 
prescription drug benefit, they also desperately want some relief from 
high prescription drug prices. They say, ``Stop the price gouging. Do 
something to make sure that prescription drugs are reasonably 
affordable for everyone.''
  PBMs have come to dominate the prescription drug benefit market. 
Nearly 210 million Americans are served by one of the four largest 
PBMs.
  According to the Centers for Medicaid and Medicare Services, national 
prescription drug spending increased by 15.7 percent in 2001. Despite 
promises from pharmacy benefit managers to lower costs, prescription 
drugs continue to be the fastest growing sector of health care spending 
in this country.
  Soaring in tandem with prescription drugs prices are PBM profits. St. 
Louis-based Express Scripts--one of the four largest PBMs--provides 
coverage to 40 million people. The company reported that its net income 
grew 63 percent last year to $202.8 million.
  Another one of the big four, Advance PCS, which covers 75 million 
people, was ranked by Fortune Magazine as the ninth fastest growing 
company in the nation based on its profits over the past 5 years.
  Unfortunately, it has been near impossible to find out whether PBMs 
are fairly sharing rebates and other savings with patients or simply 
using it to boost the bottom line.
  Even the General Accounting Office has been unable to find out how 
rebates are being divided between PBMs and the Federal Employees Health 
Benefits Plan. A GAO requested by Senator Dorgan last year failed to 
discover if the PBMs were passing along the savings because none of the 
PBMs financial documents were available for review.
  Several private companies and employee groups that contract with PBMs 
have resorted to lawsuits to get access to this information.
  The Cantwell-Lincoln amendment requires the PBM to disclose to the 
Department of Justice the financial arrangements that dictate what 
percentage of rebates and other savings are being passed back to the 
client.
  This disclosure creates a major incentive for PBMs to return as much 
as possible of the rebates and spread back to the Medicare program. 
This incentive also will help reduce prescription drug prices.
  The PBMs have argued that reporting this financial information would

[[Page 16613]]

kill their ability to continue to negotiate low drug prices. I am a 
businesswoman, and I understand the need to keep financial agreements 
confidential. That is why my amendment mandates the information be 
handed over to the Department of Justice, where it remains 
confidential.
  Department of Justice oversight also allows for regular review of 
these financial arrangements to weed out any potential collusion on 
pricing. This added protection also will help lower drug costs for 
seniors.
  The Cantwell-Lincoln amendment also prohibits PBMs from being owned 
by pharmaceutical manufacturers. This cross-ownership is problematic 
because it could allow for pharmaceutical companies to collude with 
PBMs to favor the manufacturers more expensive drugs over less 
expensive alternatives.
  A report on PBMs by the National Health Policy Forum points out the 
concerns raised by close relationships between PBMs and drug 
manufacturers. Close ties between the two could lead to a lack of drug 
choice for consumers, with one manufacturer's drugs getting 
preferential treatment by the PBM.
  Actions taken this week by the U.S. attorney in Philadelphia 
reinforce the need for greater PBM oversight as outlined in the 
Cantwell-Lincoln amendment.
  Madam President, I ask unanimous consent that articles from the 
Washington Post and Wall Street Journal be printed in the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

             [From the Wall Street Journal, June 24, 2003]

  U.S. Is Joining Lawsuit That Says Medco Put Profits Before Patients

                         (By Barbara Martinez)

       The Justice Department is joining a lawsuit that alleges 
     Merck & Co.'s Medco pharmacy-benefits subsidiary adopted an 
     ``aggressive profits-before-patients policy.'' Medco's 
     approach resulted in a potentially dangerous lack of 
     oversight in filling prescriptions and increased 
     pharmaceutical costs for the federal government, the suit 
     says.
       The department's involvement in the suit, brought by two 
     former Medco pharmacists, doesn't necessarily mean that it 
     believes all the allegations. But it signals that the 
     government investigated the accusations and found at least 
     some of them worth pursuing in court. The government, which 
     also joined a second lawsuit against Medco Monday that made 
     similar allegations, intends to file its own complaint within 
     90 days. Justice Department investigators have been examining 
     Medco and other pharmacy-benefit managers, or PBMs, for 
     several years, but this is the first time they have indicated 
     that any suit would be filed. PBMs handle prescription-drug-
     card benefits for millions of employees.
       The complaint alleges that after Merck--one of the world's 
     largest drug companies--purchased Medco in 1993, the PBM 
     began to make systemic changes in its mail-order 
     prescription-filling system--disregarding safety and instead 
     promoting higher profits per prescription.
       In a statement, Medco said, ``We are confident that when 
     all the facts are presented they will show that our business 
     has one focus, providing the highest quality of prescription 
     health care to our clients and members.'' It added: We are 
     prepared to present a nigorous defense and believe that we 
     will prevail. We will prove that the allegations'' in the 
     complaint ``are absolutely untrue or reflect years-old 
     isolated issues that were identified and corrected and in no 
     way and at no time compromise the quality of patient care.''
       The airing of previously sealed allegations in the suit 
     comes at a difficult time for both Merck and PBMs. Merck 
     plans to spin off Medco as a publicly traded company this 
     year, while PBMs have been angling to get a piece of a 
     Medicare drug benefit currently being debated in Congress. 
     Medco provides drug benefits to more than 60 million 
     Americans, including millions of federal and state employees. 
     Medco's annual revenue totals about $30 billion.
       The case could have repercussions on Capitol Hill, too, 
     where PBMs are locked in a fierce lobbying battle, especially 
     with the retail-pharmacy industry, over details of Medicare 
     legislation. The measure would create a drug benefit that 
     PBMs would have a prominent role in providing. Already 
     Monday, the National Community Pharmacists Association, which 
     represents about 25,000 owners of independent drugstores, 
     stepped up its lobbying efforts. The group is pushing for 
     stricter disclosure requirements for PBMs.
       In the newly unsealed complaint, which was filed in U.S. 
     District Court in Philadelphia, the two former Medco 
     pharmacists make detailed charges that enormous pressure was 
     placed on employees to falsify orders to meet goals and to 
     disregard complaints by patients and doctors about drug 
     switching or pill shortages.
       Daily internal publication of prescription-error rates to 
     help pharmacists measure their own safety standards were 
     eliminated, the suit asserts. Instead, daily loudspeaker 
     messages announced prescription-filling costs, as well as the 
     stock price of parent company Merck, the suit says. Many 
     Medco employees are compensated in part with Merck stock 
     options.
       To save money, the suit alleges, Medco reduced licensed 
     pharmacists' role in the filling and supervising of 
     prescription drugs at its mail-order facilities. In addition, 
     the job of calling a physician to discuss a potential drug 
     interaction--once the job of only pharmacists--ultimately 
     fell to employees who ``seldom have college degrees, and have 
     no prior training in pharmacy services other than limited on-
     the-job training.'' And as a result of being pressured to 
     meet quotas on how many doctors to call, employees regularly 
     lied on physician call records to indicate they alerted 
     doctors about problems when they really had not, according to 
     the lawsuit.
       The lawsuit was filed under the Federal False Claims Act. 
     In such lawsuits, the plaintiff, often a former employee of a 
     company that does business with the government, alleges that 
     the company has defrauded the government. If the government 
     considers the allegations valid, if joins the complaint, 
     litigates the case and shares any recovery or damages with 
     the person who filed the suit.
       Medco has a significant amount of legal government 
     business, providing mail-order prescriptions to millions of 
     federal employees through the Federal Employee's Health 
     Benefit Program.
       Many of the allegations in this complaint relate to Medco's 
     mail-order business, where patients mail in a prescription 
     and Medco fills it and sends it back. PBMs such as Medco have 
     been pushing hard to promote their mail-order facilities as a 
     cost-effective alternative to retail stores.
       According to the suit, Medco ``boasts to its clients 
     nationwide that licensed pharmacists check each mail-order 
     prescription before it is sent out, with as many as three or 
     four quality checks.'' The suit says such scrutiny only 
     happened prior to Merck's 1993 acquisition of Medco.
       After the acquisition, Medco automated more of its 
     prescription-filling capabilities and ``significant changes'' 
     were instituted that ``marked a shift from prudent pharmacy 
     practices'' to a ``focus on profit maximization,'' the 
     complaint said.
       One of Medco's largest and most technologically advanced 
     mail-order facilities is in Las Vegas, where the two former 
     Medco pharmacists who filed the complaint worked. According 
     to the suit, after Medco upgraded its Las Vegas facility in 
     the mid-1990s, ``pharmacists were no longer reading and 
     verifying mailed prescriptions prior to entry into a 
     computer.'' Instead, upon arrival, the prescriptions were 
     entered by ``data-entry clerks with no formal pharmacy 
     training'' and who were supervised by nonpharmacist managers.
       The suit also alleges that under a special program, touted 
     by Medco as promoting the most cost-effective drugs, Medco 
     called doctors to get them to change their prescriptions 
     because of undisclosed payments to Medco from drug 
     manufacturers. The suit said patient and physician complaints 
     about switching prescriptions were ``common'' but that 
     ``Medco routinely ignores these complaints, including the 
     health risks associated with inappropriate drug switches.''
       In addition, Medco, like other PBMs, provides ``drug 
     utilization reviews'' of prescriptions and patients. The 
     process aims to prevent adverse drug interactions, verifies 
     appropriate drug strength, catches drug allergies or 
     duplicate medications.
       Until 1995, such calls to physicians to alert them to 
     possible problems were made by pharmacists who could fully 
     explain the situation and suggest alternatives. Subsequently, 
     the suit says, these calls were being made only by ``cheaper, 
     non-pharmacists employees.'' The pharmacist was only brought 
     in at the end of a call, to verify information.
       But with workers having quotas of 20 to 25 calls an hour, 
     the pharmacist was handling as many as 100 calls within 60 
     minutes. As a result of pressures to meet the quotas, the 
     complaint said, employees regularly fabricated records 
     documenting that they called doctors to alert them to 
     potential safety issues, among other matters, when they 
     really hadn't. Sometimes, the suit says, the employees would 
     change prescriptions without the pharmacist's intervention.
       In other areas of the mail-order facility, the complaint 
     says, employees ``permanently delete, cancel or otherwise 
     falsify prescriptions orders'' to reduce back-order size. As 
     a result, the complaint says, many patients didn't get the 
     medications they needed.
                                  ____


               [From the Washington Post, June 24, 2003]

                    U.S. Joining Suit Against Medco

                          (By Charles Duhigg)

       The U.S. attorney in Philadelphia announced yesterday that 
     he is joining a complaint against Medco Health Solutions Inc.

[[Page 16614]]

     that alleges the nation's second-largest pharmacy-benefit 
     manager improperly canceled prescriptions, switched 
     medications without physician approval and sent patients 
     partially filled orders.
       The U.S. attorney's office has been investigating whistle-
     blower allegations against the company since 1999 and intends 
     to file its own complaint in September, said Associate U.S. 
     Attorney James G. Sheehan.
       The government has decided to intervene in two lawsuits 
     brought by three whistle-blowers. Those suits allege that 
     Medco changed prescriptions without a physician's approval to 
     favor more expensive drugs produced by Merck & Co. and 
     induced physicians with false information to switch to higher 
     cost Merck drugs. Medco also destroyed mail order 
     prescriptions without filling them and in other cases mailed 
     patients less than the number of pills ordered but charged 
     for the full amount, the lawsuits allege.
       Medco is a subsidiary of Merck.
       ``We know from industry studies that almost half of mail 
     order participants will run out of medicine within two days 
     if they fail to receive their new prescriptions,'' said 
     Patrick L. Meehan, the U.S. attorney for the eastern district 
     of Pennsylvania.
       Medco officials contend that the allegations are untrue or 
     ``reflect years-old isolated issues that were identified and 
     corrected,'' said Ann Smith, director of public affairs at 
     Medco. At no time was the quality of patient care 
     compromised, Smith said.
       Most Americans know pharmacy benefit managers, or PBMs, 
     from the plastic cards they hand over at local pharmacies 
     when filling a prescription. Major employers and health plans 
     hire these companies to negotiate with drug companies to 
     control drug costs for plan enrollees, and to oversee the 
     complex paperwork associated with filling prescriptions.
       The Senate is considering plans to provide prescription 
     drug coverage to the elderly that may enhance the clout of 
     pharmacy-benefit managers, industry analysts say. The 
     companies are expected to administer government drug spending 
     under some plans, according to congressional testimony 
     offered by the National Association of Chain Drug Stores, and 
     to receive a larger share of government reimbursements for 
     prescription drugs.
       More than 62 million Americans get prescriptions processed 
     through Medco, according to the company. Medco handles 
     pharmacy benefits totaling nearly $30 billion per year, 
     including $1.2 billion from Blue Cross/Blue Shield as part of 
     the Federal Employees Health Benefits Program.
       George Bradford Hund and Walter W. Gauger, who both worked 
     as pharmacists in Medco's Las Vegas processing facility, and 
     Joseph Piacentile, a physician, allege in their complaints 
     that on busy days Medco would cancel or destroy prescriptions 
     to avoid penalties for delays in filling orders. Customers 
     would be told that the prescriptions had never been received, 
     Sheehan said.
       The company is also accused of fabricating records and, 
     when the handwriting on prescriptions was unclear or 
     difficult to read, simply guessing at what they said, 
     according to Sheehan. The government's suit against Medco 
     could ask for damages in the millions of dollars and new 
     oversight systems.
       Merck acquired Medco in 1993 at a time when other 
     drugmakers were purchasing pharmacy-benefit managers. By the 
     end of the 1990s, all pharmaceutical manufacturers but Merck 
     had sold their units amid concerns that the drug companies 
     would use the benefit managers to push their own drugs, 
     rather than doing what was best for clients.
       I 1998 Merck signed a settlement agreement with the Federal 
     Trade Commission stating that ``Medco has given favorable 
     treatment to Merck drugs.'' Last December, Medco agreed to 
     pay $42.5 million to settle a class-action lawsuit alleging 
     that the company improperly promoted higher priced Merck 
     drugs rather than seeking the best price from alternative 
     pharmaceutical companies. Merck announced it intended to spin 
     off Medco last year, but delayed the initial public offering 
     of shares because of the depressed stock market.
       Yesterday's announcement marks the first significant legal 
     action by a federal agency against a pharmacy-benefit 
     manager. Previously, attorneys general of at least 25 states 
     have opened inquires into Medco to determine whether it has 
     violated state laws, and New York State Attorney General 
     Eliot L. Spitzer said last Friday that his office was 
     investigating another company, Express Scripts Inc., for 
     allegedly overbilling state health plans.
       Shares of Merck closed yesterday at $62.11, down 78 cents, 
     or 1.24 percent.
                                  ____


               [From the Washington Post, June 24, 2003]

                 Medco Accused of Favoring Merck Drugs

                          (By David B. Caruso)

       Federal prosecutors on Monday said a company that was 
     supposed to help health plans find low-cost prescription 
     drugs instead pressured doctors to switch patients to 
     medications made by its owner, pharmaceutical giant Merck & 
     Co.
       U.S. Attorney Patrick Meehan said his office has joined a 
     pair of civil ``whistleblower'' lawsuits against Medco Health 
     Solutions, accusing the Merck subsidiary of providing 
     misleading information to the government in connection with 
     its contract to manage drug benefits for federal employees.
       More than 1,000 companies have hired Medco to coordinate 
     prescription drug coverage for employee health plans, making 
     it the nation's largest manager of pharmacy benefits, and the 
     company is supposed to use its bulk-purchasing power to lower 
     drug costs.
       But the suits say Medco routinely induce physicians to 
     switch patients to Merck drugs, even if a patient had been 
     doing well on another medication that cost less.
       The government also says the company failed to call doctors 
     to explain prescriptions that were unclear, and fabricated 
     records to make it appear as if calls from pharmacists to 
     physicians had been made.
       The three whistleblowers--a New Jersey doctor and two 
     Nevada pharmacists who once worked for Medco--claim the firm 
     also misled clients about its practice of accepting cash 
     rebates from pharmaceutical companies in exchange for 
     promoting their products. The suits claim the payments amount 
     to kickbacks.
       Medco spokesman Jeffrey Simek said the charges are ``either 
     absolutely untrue, or they reflect years-old isolated issues 
     that were identified and corrected.''
       He denied the firm gives preferential treatment to Merck, 
     or any other drug company.
       ``Our policy is that we will never make a drug interchange 
     that will not result in a benefit for either our clients, or 
     the members of their health plans,'' he said. ``If we 
     improperly favored any drug by any single company, we could 
     never succeed.''
       Several health plans have previously sued Medco, claiming 
     that it improperly accepted $3.56 billion in payments from 
     drug companies in the late 1990s to promote their products, 
     but Monday's filing by the U.S. Attorney in Philadelphia is 
     the first such action by a federal prosecutor.
       Medco, like other pharmacy benefit companies, acknowledges 
     participating in rebate programs. Simek said the company took 
     in $2.5 billion in rebates in 2001. But he said the payments 
     work like coupons and ultimately lower medication costs for 
     clients.
       The suits also accuse Medco, of Franklin Lakes, N.J., of 
     shortchanging patients by mailing them fewer than the number 
     of pills they paid for. They say the company tried to avoid 
     penalties for delays in filling mail orders by destroying 
     prescriptions on days when the order volume was heavy.
       Simek said the company investigated the allegations and 
     determined they were isolated incidents that didn't affect 
     patient care. Two employees were fired, he said.
       Court filings identified the whistleblowers as Dr. Joseph 
     Piacentile, of New Jersey, and George Bradford Hunt and 
     Walter W. Gauger, two pharmacists who previously worked for 
     Medco in Las Vegas.
       Attorneys general in several states have said they are also 
     investigating whether the company, and other pharmacy benefit 
     firms, broke the law.
       Merck has been trying to spin off its Medco business. It 
     canceled an initial public offering for the company in July 
     after revealing that it had misstated its revenues by $12 
     billion in recent years by counting prescription copyaments 
     made to pharmacies as Medco revenue. Merck said in May that 
     the firm would be spun off instead to Merck shareholders.

  Ms. CANTWELL. Madam President, it was reported this week that U.S. 
Attorney Patrick Meehan plans to join a pair of lawsuits filed by three 
former Medco Health employees. The employees--two pharmacists and a 
doctor--allege that Medco provided misleading information to the 
Government related to a contract to provide drug coverage for Federal 
employees. The lawsuits accuse Medco of switching patients to more 
expensive drugs and fabricating records to make it look as if the 
prescription changes were made by doctors and not by Medco.
  These are serious allegations resulting from an investigation that 
began in 1999. This is the first such action taken by a U.S. attorney 
against a PBM and is a strong signal that all is not right with this 
industry.
  U.S. Attorney Patrick Meehan told the Newark Star Ledger:

       The kind of conduct alleged in the complaints threatens not 
     only the integrity of the system as a whole, but also the 
     well being of the very patients it is designed to benefit. 
     These allegations suggest that, somewhere along the line, the 
     focus became the profit instead of the patient.

  The possibility of profitability trumping patient care has promoted a 
number of consumer groups to favor the accountability system outlined 
in my amendment. Consumers Union, Public Citizen, Families USA, AFSCME, 
the National Community Pharmacy Association and the Washington State 
Pharmacy Association all support my amendment.

[[Page 16615]]

  Mr. President, I ask unanimous consent that letters of support be 
printed in the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                                              Consumers Union,

                                    Washington, DC, June 25, 2003.
       Dear Senator: As the Senate continues to debate S. 1, the 
     ``Prescription Drug and Medicare Improvement Act of 2003,'' 
     Consumers Union urges you to redouble your efforts to improve 
     the legislation so that it better meets the needs of seniors 
     and people with disabilities, many of whom are in dire need 
     of meaningful protection from the devastating impact of 
     spiraling prescription drug costs.
       Some of Consumers Union's most serious concerns about S. 1 
     are:
       The amount set aside in the Congressional budget resolution 
     for a Medicare prescription drug bill, $400 billion over 10 
     years, is inadequate for the task and limits coverage to 22 
     percent of the projected prescription drug expenditures over 
     this time period;
       Prescription drug coverage provided by S. 1 is skimpy, 
     leaving many beneficiaries who lack coverage in 2003 actually 
     paying more out of their own pockets for prescription drugs 
     in 2007, when they have coverage. (For more information, 
     please see our report, Skimpy Benefits and Unchecked 
     Expenditures: Medicare Prescription Drug Bills Fail to Offer 
     Adequate Protection for Seniors 
     and People with Disabilities, at www.consumersunion.org);
       The bill lacks a standard, uniform benefit, does not 
     guarantee the availability of a prescription drug benefit 
     through the Medicare program, and leaves all beneficiaries 
     uncertain about what coverage will be available to them (and 
     uncertain about the premium they will be charged);
       While the Senate has approved helpful amendments that would 
     accelerate the introduction of generics and possibly provide 
     beneficiaries access to lower-priced drugs from Canada, the 
     bill's reliance on hundreds of private insurance companies 
     and HMOs precludes the possibility of the federal government 
     using its purchasing power to negotiate deep discounts for 
     consumers. It does too little, therefore, to rein in 
     spiraling prescription drug expenditures;
       The bill creates confusion for Medicare beneficiaries, 
     forcing them to sort out the options in the drug-only 
     marketplace and options in the HMO/PPO marketplace, and it 
     further complicates the ``comparison shopping'' task by 
     allowing the prescription drug benefits to vary from the 
     basic parameters (e.g., deductible, cost-sharing, doughnut, 
     catastrophic coverage). Simply-put, the confusing options 
     that will face Medicare beneficiaries flunks the ``kitchen 
     table'' test;
       S. 1 will leave many Medicare beneficiaries worse off since 
     employers will cut back their retiree coverage because any 
     coverage is not counted toward retirees' out-of-pocket costs; 
     and
       While the bill provides for a relatively generous subsidy 
     for low-income consumers, it requires them to get their 
     prescription drug benefit through Medicare instead of the 
     currently universal Medicare program, even though they 
     qualify for Medicare coverage by virtue of their age or 
     disability.
       We are deeply troubled by discussions that are underway 
     that would undermine the traditional fee-for-service Medicare 
     program--the very program that assures beneficiaries that 
     they have the freedom to go to the doctor of their choice--by 
     providing extra subsidization to private PPOs and HMOs. By 
     enriching the benefits available in the private marketplace, 
     PPOs and HMOs will attract relatively healthy people; the 
     traditional fee-for-service Medicare option will erode over 
     time, because of the design of the subsidies and desire to 
     cut costs. The sickest and most vulnerable will be severely 
     disadvantaged.
       There are several amendments that would help address some 
     of the problems with S. 1. We urge you to support amendments 
     that would:
       Expand the prescription drug benefits so that they are 
     comparable to prescription drug coverage in employer-based 
     health insurance plans;
       Rein in prescription drug expenditures through the use of 
     the federal government's buying power to negotiate deep 
     discounts;
       Provide for scientific study of the comparative 
     effectiveness of alternative prescription drugs;
       Guarantee that beneficiaries would have access to a 
     prescription drug benefit through the Medicare program at a 
     set premium;
       Count the contributions made by employers toward 
     beneficiaries' out-of-pocket costs;
       Maintain a level-playing field so that benefits in PPOs and 
     HMOs are not more generous than benefits available in 
     traditional fee-for-service Medicare;
       Instruct the National Association of Insurance 
     Commissioners to adjust medigap benefit packages to allow 
     beneficiaries to buy additional coverage;
       Increase the transparency of transactions by pharmaceutical 
     benefit managers;
       Cut the time before the prescription drug benefits begin.
       The current debate about a Medicare prescription drug 
     benefit has led seniors and persons with disabilities to 
     believe that relief is in sight. In its present form, S. 1 
     will be a big disappointment to beneficiaries when it is 
     implemented in 2006. We urge you to amend S. 1 so that it is 
     more effective in providing meaningful relief to Medicare 
     beneficiaries while addressing the pressing need to curb 
     prescription drug expenditures.
           Sincerely,

                                              Gail E. Shearer,

                                 Director, Health Policy Analysis,
     Washington Office.
                                  ____

         Society of Professional Engineering Employees in 
           Aerospace,
                                        Seattle, WA, June 5, 2003.
     Hon. Maria Cantwell,
     U.S. Senate,
     Washington, DC.
       Dear Senator Cantwell: As you know, union members and 
     retirees in Washington are very concerned about the current 
     activities involving prescription drug benefits for Medicare 
     seniors. We thought you should know that we are part of a 
     national delegation of unions that met with Secretary Tommy 
     Thompson to express our opposition to any PBM-based 
     alternative to our local pharmacies.
       PBMs own much of the mail order drug service in this 
     country. For the past 2 years, we have been warning 
     congressional members that a PBM-based benefit would 
     potentially harm many local pharmacies that serve our 
     communities. Still however, lawmakers almost passed a PBM-
     based benefit in the 107th Congress.
       Since last year, the reputation of PBMs has grown worse. 
     Now they are being sued by a California based union, AFSCME. 
     Allegedly, four of the largest PBMs have been pocketing money 
     that is meant for the consumer.
       SPEEA urges you and your fellow Senators to look into this 
     lawsuit before passing any PBM-based legislation. In this day 
     and age, transparency must be part of any program set up by 
     the United States government.
           Sincerely,
                                               Charles Bofferding,
     Executive Director.
                                  ____

         American Federation of State, County and Municipal 
           Employees, AFL-CIO,
                                    Washington, DC, June 24, 2003.
     Hon. Maria Cantwell,
     U.S. Senate,
     Washington, DC.
       Dear Senator Cantwell: On behalf of AFSCME's 1.4 million 
     members, I am writing to express my strong support for your 
     amendment to S. 1, the Medicare prescription drug bill, that 
     would make certain that costs savings generated by Pharmacy 
     Benefit Managers (PBM) on behalf of the Medicare program are 
     returned to the program. We believe that this is a critical 
     means of controlling costs for this new benefit.
       PBMs create most of their cost savings and their profits by 
     negotiating with drug manufacturers to receive favorable 
     rates on a pharmaceutical company's drugs in exchange for 
     including the drugs on the PBM's formulary of preferred 
     medicines. This bill would require that all contracts with 
     PBMs to provide the Medicare benefit with a private insurer 
     or the government itself include language that would ensure 
     that all savings negotiated with a pharmacy be passed back to 
     the government or the private insurer administering the 
     benefit on behalf of the government.
       We believe it is crucial that PBMs be required to disclose 
     the percentage of rebate they have negotiated with the 
     pharmaceutical companies that are passed onto their clients. 
     Your amendment would do precisely that--giving some assurance 
     to consumers and the government that the savings achieved by 
     the PBMs are being shared.
       I believe that your amendment goes a long way toward 
     ensuring that Medicare beneficiaries will receive their fair 
     share of the cost savings produced by contracts with PBMs, 
     and AFSCME strongly supports its adoption.
           Sincerely,
                                              Charles M. Loveless,
     Director of Legislation.
                                  ____

                                                    June 18, 2003.
     Hon. Maria Cantwell,
     U.S. Senate,
     Washington, DC.
       Dear Senator Cantwell: Families USA, the national consumer 
     health advocacy organization, strongly endorses your 
     amendment to ensure that the conflicts of interest, which can 
     occur in the delivery of a Medicare prescription drug 
     benefit, are minimized or avoided.
       Everyone agrees that whether Medicare directly administers 
     the benefit or whether it is administered through private 
     plans, Pharmacy Benefit Managers (PBM) will be used. They 
     have the expertise and knowledge necessary to help administer 
     this program. But in the recent past, there have been 
     examples of abuse in this sector. particularly troubling has 
     been the steering of patients to a particular prescription 
     drug product because it was more profitable for the 
     administering company and not because it was better for

[[Page 16616]]

     the patient! In a very real sense, that is malpractice. It is 
     inexcusable. It must be stopped. At least one major PBM has 
     announced a code of ethics to prevent such abuses. But these 
     important consumer protections should not depend on company-
     by-company internal codes of ethics. Your amendment is 
     needed.
       Your amendment requires the confidential disclosure of the 
     type of information that will enable the Department of Health 
     and Human Services to protect against rebates and kickbacks 
     that would cause a company to steer people toward profitable 
     medicine rather than needed medicine. Your amendment helps 
     ensure that those who will surely be called on to help 
     administer the new benefit provide good health care to the 
     beneficiaries and not just profitable health care to their 
     owners.
           Sincerely,
                                                Ronald F. Pollack,
     Executive Director.
                                  ____

                                                  Washington State


                                         Pharmacy Association,

                                        Renton, WA, June 23, 2003.
     Hon. Maria Cantwell,
     U.S. Senate,
     Washington, DC.
       Dear Senator Cantwell: The Washington State Pharmacy 
     Association, representing pharmacy practitioners from all 
     practice arenas in the State of Washington, strongly endorses 
     your amendment to ensure that the conflicts of interest, 
     which can occur in the delivery of a Medicare prescription 
     drug benefit through a PBM, are minimized or avoided.
       Pharmacy Benefit Managers (PBM) are an integral part of the 
     health care delivery system. Efficient plan administration 
     and timely claims processing are mandatory components of a 
     successful health care benefit which are important to 
     patients, payers and providers. However, in recent years the 
     PBM industry has expanded their role to include benefit 
     design that has created significant conflicts of interest and 
     ethical questions of appropriate health care delivery versus 
     profitable health care delivery.
       Your amendment, as proposed, provides the necessary 
     transparency that will provide patients, payers, and 
     regulators the necessary information to appropriately monitor 
     PBM business practices. Your amendment is a significant step 
     toward insuring that the health care provided to the citizens 
     of this country is focused on improving the patient's health 
     and wellbeing and not the fiscal wellbeing of the pharmacy 
     benefit managers.
           Sincerely,
                                                Rod Shafer, R.Ph.,
                                                              CEO.

  Ms. CANTWELL. Madam President, these groups and others have been 
trying to call attention to problematic PBM practices. These groups 
rightly point out that strong consumer protections are needed in any 
Medicare drug benefit.
  The American Association of State, County and Municipal Employees 
agrees that these protections provide ``a critical means of controlling 
costs.''
  A national coalition of workers representing more than 20 states also 
are supportive of efforts to monitor PBMs. Many in this coalition 
currently use PBMs to provide benefits and many of them are wondering 
why drug costs continue to rise.
  There is a balance to be had here, and the Cantwell-Lincoln amendment 
makes sure the scale is not tipped too far one way. It is a good 
amendment that will lower prescription drug prices, provide much needed 
consumer protections and ensure strong government oversight. I urge my 
colleagues to support it.
  Mr. GRASSLEY. Is the amendment before us now?
  The PRESIDING OFFICER. The amendment is before us.
  Mr. GRASSLEY. We have looked at the amendment on this side. It has 
been modified, and I urge we accept it on a voice vote.
  Mr. BAUCUS. We have looked at this amendment. I agree with Senator 
Grassley. We accept the amendment.
  The PRESIDING OFFICER. The question is on agreeing to amendment No. 
942, as modified.
  The amendment (No. 942), as modified, was agreed to.
  Mr. GRASSLEY. I move to reconsider the vote.
  Mr. BAUCUS. I move to lay that motion on the table.
  The motion to lay on the table was agreed to.
  Mr. BAUCUS. I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mr. BYRD. Madam President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. BYRD. Madam President, I ask unanimous consent that I may speak 
out of order.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. BYRD. I thank the Chair.
  (The remarks of Mr. Byrd are printed in today's Record under 
``Morning Business.'')


                           Amendment No. 1095

  The PRESIDING OFFICER. The Senator from Nevada.
  Mr. REID. Mr. President, I ask unanimous consent the pending 
amendments be temporarily set aside.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. REID. On behalf of the Senator from South Dakota, Senator 
Johnson, I send an amendment to the desk.
  The PRESIDING OFFICER. The clerk will report.
  The assistant legislative clerk read as follows:

       The Senator from Nevada [Mr. Reid], for Mr. Johnson, for 
     himself and Mr. Cochran, proposes an amendment numbered 1095.

  Mr. REID. I ask unanimous consent the reading of the amendment be 
dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The amendment is as follows:

    (Purpose: To provide for a 1-year medication therapy management 
                          assessment program)

       At the end of subtitle A of title I, add the following:

     SEC. __. MEDICATION THERAPY MANAGEMENT ASSESSMENT PROGRAM.

       (a) Establishment.--
       (1) In general.--The Secretary shall establish an 
     assessment program to contract with qualified pharmacists to 
     provide medication therapy management services to eligible 
     beneficiaries who receive care under the original medicare 
     fee-for-service program under parts A and B of title XVIII of 
     the Social Security Act to eligible beneficiaries.
       (2) Sites.--The Secretary shall designate 6 geographic 
     areas, each containing not less than 3 sites, at which to 
     conduct the assessment program under this section. At least 2 
     geographic areas designated under this paragraph shall be 
     located in rural areas.
       (3) Duration.--The Secretary shall conduct the assessment 
     program under this section for a 1-year period.
       (4) Implementation.--The Secretary shall implement the 
     program not later than January 1, 2005, but may not implement 
     the assessment program before October 1, 2004.
       (b) Participants.--Any eligible beneficiary who resides in 
     an area designated by the Secretary as an assessment site 
     under subsection (a)(2) may participate in the assessment 
     program under this section if such beneficiary identifies a 
     qualified pharmacist who agrees to furnish medication therapy 
     management services to the eligible beneficiary under the 
     assessment program.
       (c) Contracts With Qualified Pharmacists.--
       (1) In general.--The Secretary shall enter into a contract 
     with qualified pharmacists to provide medication therapy 
     management services to eligible beneficiaries residing in the 
     area served by the qualified pharmacist.
       (2) Number of qualified pharmacists.--The Secretary may 
     contract with more than 1 qualified pharmacist at each site.
       (d) Payment to Qualified Pharmacists.--
       (1) In general.--Under an contract entered into under 
     subsection (c), the Secretary shall pay qualified pharmacists 
     a fee for providing medication therapy management services.
       (2) Assessment of payment methodologies.--The Secretary 
     shall, in consultation with national pharmacist and pharmacy 
     associations, design the fee paid under paragraph (1) to test 
     various payment methodologies applicable with respect to 
     medication therapy management services, including a payment 
     methodology that applies a relative value scale and fee-
     schedule with respect to such services that take into account 
     the differences in--
       (A) the time required to perform the different types of 
     medication therapy management services;
       (B) the level of risk associated with the use of particular 
     outpatient prescription drugs or groups of drugs; and
       (C) the health status of individuals to whom such services 
     are provided.
       (e) Funding.--
       (1) In general.--Subject to paragraph (2), the Secretary 
     shall provide for the transfer from the Federal Supplementary 
     Insurance Trust Fund established under section 1841 of the 
     Social Security Act (42 U.S.C. 1395t) of such funds as are 
     necessary for the costs of carrying out the assessment 
     program under this section.
       (2) Budget neutrality.--In conducting the assessment 
     program under this section, the Secretary shall ensure that 
     the aggregate payments made by the Secretary do not exceed 
     the amount which the Secretary would

[[Page 16617]]

     have paid if the assessment program under this section was 
     not implemented.
       (f) Waiver Authority.--The Secretary may waive such 
     requirements of titles XI and XVIII of the Social Security 
     Act (42 U.S.C. 1301 et seq.; 1395 et seq.) as may be 
     necessary for the purpose of carrying out the assessment 
     program under this section.
       (g) Availability of Data.--During the period in which the 
     assessment program is conducted, the Secretary annually shall 
     make available data regarding--
       (1) the geographic areas and sites designated under 
     subsection (a)(2);
       (2) the number of eligible beneficiaries participating in 
     the program under subsection (b) and the level and types 
     medication therapy management services used by such 
     beneficiaries;
       (3) the number of qualified pharmacists with contracts 
     under subsection (c), the location of such pharmacists, and 
     the number of eligible beneficiaries served by such 
     pharmacists; and
       (4) the types of payment methodologies being tested under 
     subsection (d)(2).
       (h) Report.--
       (1) In general.--Not later than 6 months after the 
     completion of the assessment program under this section, the 
     Secretary shall submit to Congress a final report summarizing 
     the final outcome of the program and evaluating the results 
     of the program, together with recommendations for such 
     legislation and administrative action as the Secretary 
     determines to be appropriate.
       (2) Assessment of payment methodologies.--The final report 
     submitted under paragraph (1) shall include an assessment of 
     the feasibility and appropriateness of the various payment 
     methodologies tested under subsection (d)(2).
       (i) Definitions.--In this section:
       (1) Medication therapy management services.--The term 
     ``medication therapy management services'' means services or 
     programs furnished by a qualified pharmacist to an eligible 
     beneficiary, individually or on behalf of a pharmacy 
     provider, which are designed--
       (A) to ensure that medications are used appropriately by 
     such individual;
       (B) to enhance the individual's understanding of the 
     appropriate use of medications;
       (C) to increase the individual's compliance with 
     prescription medication regimens;
       (D) to reduce the risk of potential adverse events 
     associated with medications; and
       (E) to reduce the need for other costly medical services 
     through better management of medication therapy.
       (2) Eligible beneficiary.--The term ``eligible 
     beneficiary'' means an individual who is--
       (A) entitled to (or enrolled for) benefits under part A and 
     enrolled for benefits under part B of the Social Security Act 
     (42 U.S.C. 1395c et seq.; 1395j et seq.);
       (B) not enrolled with a Medicare+Choice plan or a 
     MedicareAdvantage plan under part C; and
       (C) receiving, in accordance with State law or regulation, 
     medication for--
       (i) the treatment of asthma, diabetes, or chronic 
     cardiovascular disease, including an individual on 
     anticoagulation or lipid reducing medications; or
       (ii) such other chronic diseases as the Secretary may 
     specify.
       (3) Qualified pharmacist.--The term ``qualified 
     pharmacist'' means an individual who is a licensed pharmacist 
     in good standing with the State Board of Pharmacy.

  Mr. McCONNELL. Mr. President, I ask unanimous consent that 
immediately following Senator Kennedy's comments I be recognized to 
offer an amendment regarding cancer. I further ask unanimous consent 
that this morning the Senate proceed to a vote in relation to the 
McConnell amendment, to be followed immediately by a vote in relation 
to the Boxer amendment numbered 1036, to be followed immediately by a 
vote in relation to the Bingaman amendment numbered 1065, with no 
second degrees in order to the three above amendments prior to the 
vote, with 2 minutes equally divided prior to the vote, and with 10 
minutes equally divided before the first vote.
  Mr. REID. Mr. President, it is my understanding that as soon as 
Senator Kennedy finishes his speech Senators McConnell and Boxer will 
be recognized for 10 minutes with the time equally divided, and then we 
go into the series of votes. Is that right?
  Mr. McCONNELL. That is my understanding.
  The PRESIDING OFFICER. Is there objection? Without objection, it is 
so ordered.
  The Senator from Massachusetts is recognized.


                           Amendment No. 1092

  Mr. KENNEDY. Mr. President, we will have a chance to have greater 
discussion and debate on one of the important amendments that is before 
the Senate. But I wanted to bring to the attention of our Members as we 
go through the course of the day the Grassley-Baucus amendment, which 
has two different parts to it. I would like to address the part of the 
amendment which I find enormously compelling and which deserves the 
broad support of all the Members of this body.
  This amendment provides equal funding for Medicare and the private 
plan demonstration plans. That is effectively what will be in the 
Grassley-Baucus amendment. The Republicans say the private sector can 
do a better job providing health care for seniors and we say Medicare 
can do a better job. This amendment tests both. This amendment improves 
the coordination of care for seniors with multiple chronic conditions 
who remain in Medicare. Republicans have said we need to move seniors 
into private plans if we want to provide chronic care coordination, 
disease management, or enhanced preventive services.
  I am confident this demonstration program will show Medicare can do 
an even better job than private plans in providing preventive health 
services and ensuring care coordination. Care for patients with chronic 
conditions is especially critical. These patients account for 95 
percent of Medicare spending, according to ``Care Coordination for 
People with Chronic Conditions'', an analysis published this year by 
Johns Hopkins University.
  Currently, 60 million Americans have multiple chronic conditions, and 
that number is expected to grow to 157 million by the year 2020.
  Sixty-two percent of seniors have multiple chronic conditions, but 
their care is often fragmented. A senior citizen may get treatment for 
her diabetes from one doctor, care for her arthritis from a second 
doctor and attention for her high blood pressure from a third.
  Study after study shows that improving the coordination of care for 
those with multiple chronic conditions can improve outcomes and reduce 
costs.
  For example, in Laconia, NH, the Home and Community Based Care 
program improved disease management for seniors with multiple 
conditions. This program saved an average of $8,100 in health care 
costs for each senior served and decreased admission to nursing homes.
  In Georgia, the Service Options Using Resources in a Community 
Environment--SOURCE--program improved disease management for 1,600 
beneficiaries in 80 counties. The costs of caring for those seniors in 
the SOURCE program over two years was over $4,000 lower than for those 
who were not in the program.
  My own state of Massachusetts is part of the New England States 
Consortium, a multi-state effort funded by the Robert Wood Johnson 
Foundation to study the improvements that can be made in health care 
through better care coordination.
  Expert groups in health care have said that care coordination should 
be one of the highest priorities for our health care system. For 
example, in its recent report, Priority Areas for National Action: 
Transforming Health Care Quality, the Institute of Medicine identified 
20 ``priority areas'' for improving health care.
  The Institute of Medicine has carefully examined the issue of care 
quality. The Institute's recent report, ``Priority Areas for National 
Action'' has a series of recommendations on improving the quality of 
health care in America. We have included in our amendment 13 of the 20 
priority items that have been identified by the Institute of Medicine 
that will make a significant difference in quality. The amendment will 
have an important impact in reducing costs by improving care 
coordination and providing needed preventive services.
  A recent study funded by the Robert Wood Johnson Foundation reaches 
the same conclusion. The study examined the effect of care coordination 
on outcomes for patients with diabetes. Care coordination and simple 
preventive services dramatically improved the outcome for patients with 
diabetes in terms of their blood glucose levels. Elevated blood glucose 
is a major concern for patients with diabetes, and preventive services 
are effective in keeping

[[Page 16618]]

blood glucose levels down. As we know, diabetes is one of the principal 
health concerns for our country, and is of particular concern for our 
seniors.
  A decrease of even one percentage point in the blood glucose level of 
a patient with diabetes can have a profound effect on health. That 
seemingly small decrease results in a 21 percent drop in mortality from 
the disease, a 12 percent decrease in strokes, a 24 percent decrease in 
renal failure, and a remarkable 43 percent drop in the amputations that 
so many patients face as a result of this cruel disease. More effective 
management of blood glucose levels is also effective in keeping 
patients out of hospitals or nursing homes and thus reducing costs. A 
reduction in blood glucose levels of just one percent reduces health 
care costs by $800 per patient.
  These kinds of extraordinary improvements in health care quality are 
what this amendment is all about. We are going to provide some $6 
billion nationwide over a 5-year period to give life to these kinds of 
quality improvement efforts, and we are going to challenge the private 
sector to do it as well.
  We believe that the kinds of quality improvement initiatives included 
in this amendment will be a major factor for the support for this 
legislation. Health care quality and its impact on health care costs is 
an aspect of the health care debate that has not received sufficient 
attention.
  This amendment will give us an opportunity to take dramatic steps 
forward in Medicare which will strengthen and improve the quality of 
health care for our seniors. The amendment will also have a very 
positive impact in terms of cost reductions.
  This amendment also addresses the whole question of prevention which 
is equally critical to keeping people healthy. Immunizations, managing 
high blood pressure, cancer screening, and patient education can all 
have an enormous impact on keeping people healthy and reducing costs. 
Too often Medicare pays huge amounts to care for people who are sick 
but fails to invest adequately in keeping them healthy.
  Failure to invest adequately in preventive services is a tragic 
consequence of the repayment system we now have under the Medicare 
system. When the original Medicare system was established, we did not 
have the knowledge, awareness, and understanding of the importance of 
prevention nearly to extent we have it today. Preventive care was not 
reimbursed the way it should be.
  Under this amendment, we will have the opportunity to provide the 
kinds of real, effective support for prevention programs they deserve. 
Increased support for preventive services will mean lower costs and 
better quality of care for our seniors under Medicare.
  As I mentioned, too often we pay huge amounts to care for people who 
are sick, but fail to invest in keeping people healthy. This amendment 
gives Medicare the tools to invest in keeping people healthy. Too often 
the care for people with the highest cost, the most serious illnesses, 
such as cancer and stroke, is not optimal.
  This demonstration will help Medicare assure the highest quality care 
for the sickest patients. Medicare is a fine program. It has kept our 
senior citizens secure for 40 years. Today let us make Medicare even 
better with this amendment.
  I will include the selective parts of the studies I referred to 
previously in the Record. I ask unanimous consent that the selective 
parts be printed in the Record at the conclusion of my remarks.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  (See exhibit 1.)
  Mr. KENNEDY. Mr. President, as I mentioned, the New England Journal 
of Medicine--in a major study published just today--focuses on the 
issue of quality. The study demonstrates that the problem most likely 
to occur in our health care system is not overutilization of services, 
but underutilization. This point bears repeating. Patients all over 
America are not receiving the services they need to keep them healthy. 
46 percent of patients did not receive the recommended care, while only 
11 percent received care that was not recommended and was potentially 
harmful. That means that four times as many patients did not receive 
the care they needed as received care they did not need. The problem in 
our health care system is not overutilization of services, but 
underutilization.
  The problem of not receiving needed care is particularly acute for 
some of the most serious disorders that affect seniors. The New England 
Journal article states that less than a quarter of patients with 
diabetes received recommended blood tests. Fewer than two-thirds of 
patients with high blood pressure received the recommended care. These 
two diseases alone take an extraordinary toll on the lives of our 
citizens. Nearly 600,000 seniors die each year from heart disease, and 
complications of diabetes kill over 50,000 seniors. We could 
dramatically reduce the serious toll of these diseases--and many 
others--by improving access to preventive services and enhancing the 
quality of care.
  Modern medicine--and a strong Medicare program--have been effective 
in allowing seniors to live with chronic conditions that once were 
fatal. Millions of seniors are alive today because of advances in the 
treatment of heart disease, high cholesterol, cancer and other serious 
illnesses. As a result of this success, however, millions of seniors 
have multiple chronic conditions which put them at higher risk for 
illness and hospitalization. The Institute of Medicine reports that 
only 0.7 percent of seniors with just one chronic condition require 
hospitalization in any given year. 6.2 percent of seniors with 4 
chronic conditions are hospitalized, and over 25 percent of those with 
10 or more chronic conditions require a hospital stay. Currently, 60 
million Americans have multiple chronic conditions, and that number is 
expected to grow to 157 million over the next two decades.
  Improving the coordination of care for those with multiple chronic 
conditions can markedly improve outcomes. Yet the average Medicare 
beneficiary sees more than six different doctors in a year. Clearly, we 
need to do more to see that seniors receive the most appropriate care 
for all their conditions--not just the one that any particular doctor 
among these six is treating individually. Study after study cited by 
the Institute of Medicine indicates that care is inadequately 
coordinated for patients with some of the most serious diseases.
  Our health care system also fails to provide adequate preventive 
services. Survival rates for many forms of cancer increase dramatically 
if the disease is detected early--yet far too few patients receive the 
type of early screening that can literally mean the difference between 
life and death. For example, early diagnosis of colon cancer results in 
a survival rate of 90 percent, but that survival rate drops 
precipitously if the cancer spreads or grows before it is detected. 
Early detection not only saves lives--it reduces costs too. Proper 
screening can save up to $25,000 for every patient who avoids painful 
and lengthy treatment through early detection of cancer. Despite this 
compelling evidence of the value of preventive services, only a third 
of patients receive the recommended form of colon cancer screening.
  The story is the same with adult immunization. Pneumonia and 
influenza are the seventh leading cause of death in the United States, 
and the fifth leading cause of death among seniors. Over a third of 
seniors with invasive pneumonia will die of the disease. Many cases of 
these diseases are preventable with a simple immunization--yet one-
third to one-half of all seniors do not receive needed immunizations. 
Coverage rates for high-risk seniors are particularly poor. Tragically, 
only about a quarter of seniors with chronic disease receive a flu 
shot.
  This very important amendment will address these challenges which the 
Institute of Medicine, the Robert Wood Johnson Foundation, and the New 
England Journal of Medicine have all commented on as being critical if 
we are going to strengthen quality and begin to get a greater handle on 
costs.
  I will refer to the part of the amendment that addresses these 
questions.

[[Page 16619]]

Page 13 of the amendment describes the enhanced benefits that will now 
be available to beneficiaries in terms of care coordination, disease 
management and preventive services not otherwise covered under section 
18 of the Social Security Administration. I ask unanimous consent to 
include the section of the bill containing this provision in the 
Record.
  The amendment provides chronic care coordination services, disease 
management services and other benefits that the Secretary will 
determine to improve preventive health care for Medicare beneficiaries. 
These services will improve chronic disease management and management 
of complex life-threatening or high-cost conditions. The amendment will 
make a real difference in improving the health of millions of seniors.
  This is really a historic opportunity. I can say, having been here 
for some period of time, the idea that you would get $6 billion over 5 
years to be able to support prevention and the coordination of care for 
our seniors--I didn't believe it would ever be realized. We have that 
chance with this amendment.
  I think one of the most important aspects of this legislation is its 
emphasis on the area of prevention, which is so important, as I have 
just described. Increased support for preventive health care services 
will improve and strengthen the quality of health care and also result 
in savings for the Medicare system. We have seen how these services 
help the intensely ill and sick and fragile elderly. And we will 
increase the coordination of services as well. All of this makes a 
great deal of sense. And we have the evidence--ample evidence--to show 
that action in this area can make a very important difference to the 
elderly.
  I will let others describe the other part of the amendment dealing 
with private plans. But we challenge them, after the 5 years in which 
the resources will be spent--with a GAO study that will report back how 
the money has been spent--we challenge them to see which will make the 
greatest difference in terms of quality of care for our senior 
population and will make a difference in terms of the savings in the 
Medicare system. There is no question in my mind--no question in my 
mind--what that GAO report will demonstrate. We have clear 
documentation and scientific information that talks about the various 
studies that have been done to date, and also the conclusions that have 
been reached by the thoughtful, nonpartisan groups in this very area.
  We welcome the opportunity to show to the American people which 
system is really going to work effectively. At the end of that period 
of time, we will have the chance to enhance and improve on that, to 
make sure the future generations' health care will be strengthened.
  So I hope this amendment, which will be before us very soon, will 
receive overwhelming support because I think it will have a real chance 
to evaluate the different approaches and see what is going to be most 
effective in terms of quality and cost.

                   Blood Glucose--Reductions Pay Off

       Longitudinal studies demonstrate that a one percentage 
     point reduction in Hemoglobin A1C (blood glucose) results in: 
     14% decrease in total mortality; 21% decrease in diabetes-
     related deaths; 14% decrease in myocardial infarction; 12% 
     decrease in strokes; 43% decrease in amputations; 24% 
     decrease in renal failure; and $800 reduction in health care 
     costs.


                     Problems with Quality of Care

       The problem with quality that is most likely to occur, is 
     underuse: 46.3 percent of participants did not receive 
     recommended care. With overuse, 11.3 percent of participants 
     received care that was not recommended and was potentially 
     harmful.


                         Variations in Quality

       There is substantial variability in the quality-of-care 
     patients receive for the 25 conditions for which at least 100 
     persons were eligible for analysis. Persons with senile 
     cataracts received 78.7 percent of the recommended care; 
     persons with alcohol dependence received 10.5 percent of the 
     recommended care. The aggregate scores for individual 
     conditions were generally not sensitive to the presence or 
     absence of any single indicator of quality.


                               Discussion

       Overall, participants received about half of the 
     recommended processes involved in care. These deficits in 
     care have important implications for the health of the 
     American public. For example, only 24 percent of participants 
     in our study who had diabetes received three or more 
     glycosylated hemoglobin tests over a two-year period. This 
     routine monitoring is essential to the assessment of the 
     effectiveness of treatment, to ensuring appropriate responses 
     to poor glycemic control, and to the identification of 
     complications of the disease at an early stage so that 
     serious consequences may be prevented.
       In our study, persons with hypertension received 64.7 
     percent of the recommended care. We have previously 
     demonstrated a link between blood-pressure control and 
     adherence to process-related measures of quality of care for 
     hypertension. Persons whose blood pressure is persistently 
     above normal are at increased risk for heart disease, stroke, 
     and death. Poor blood-pressure control contributes to more 
     than 68,000 preventable deaths annually.


                      final list of priority areas

       The committee's selection process yielded a final set of 20 
     priority areas for improvement in health care quality. 
     Improving the delivery of care in any of these areas would 
     enable stakeholders at the national, state, and local levels 
     to begin setting a course for quality health care while 
     addressing unacceptable disparities in care for all 
     Americans. The committee made no attempt to rank order the 
     priority areas selected. The first 2 listed--care 
     coordination and self-management/health literacy--are cross-
     cutting areas in which improvements would benefit a broad 
     array of patients. The 17 that follow represent the continuum 
     of care across the life span and are relevant to preventive 
     care, inpatient/surgical care, chronic conditions, end-of-
     life care, and behavioral health, as well as to care for 
     children and adolescents (see boxes ES-1 to ES-6). Finally, 
     obesity is included as an ``emerging area'' that does not at 
     this point satisfy the selection criteria as fully as the 
     other 19 priority areas.
       Recommendation 3: The committee recommends that DHHS, along 
     with other public and private entities, focus on the 
     following priority areas for transforming health care:
       Care coordination (cross-cutting);
       Self-management/health literacy (cross-cutting);
       Asthma--appropriate treatment for persons with mild/
     moderate persistent asthma;
       Cancer screening that is evidence-based--focus on 
     colorectal and cervical cancer;
       Children with special health care needs;
       Diabetes--focus on appropriate management of early disease;
       End of life with advanced organ system failure--focus on 
     congestive heart failure and chronic obstructive pulmonary 
     disease;
       Frailty associated with old age--preventing falls and 
     pressure ulcers, maximizing function, and developing advanced 
     care plans;
       Hypertension--focus on appropriate management of early 
     disease;
       Immunization--children and adults;
       Ischemic heart disease--prevention, reduction of recurring 
     events, and optimization of functional capacity;
       Major depression--screening and treatment;
       Medication management--preventing medication errors and 
     overuse of antibiotics;
       Nosocomial infections--prevention and surveillance;
       Pain control in advanced cancer;
       Pregnancy and childbirth--appropriate prenatal and 
     intrapartum care;
       Severe and persistent mental illness--focus on treatment in 
     the public sector;
       Stroke--early intervention and rehabilitation;
       Tobacco dependence treatment in adults; and
       Obesity (emerging area).


               Care Coordination--Rationale for Selection

                                 Impact

       Nearly half of the population--125 million Americans--lives 
     with some type of chronic condition. About 60 million live 
     with multiple such conditions. And more than 3 million--2.5 
     million women and 750,000 men--live with five such conditions 
     (Partnership for Solutions, 2001). For those afflicted by one 
     or more chronic conditions, coordination of care over time 
     and across multiple health care providers and settings is 
     crucial. Yet in a survey of over 1,200 physicians conducted 
     in 2001, two-thirds of respondents reported that their 
     training was not adequate to coordinate care or education for 
     patients with chronic conditions (Partnership for Solutions, 
     2001).
       More than 50 percent of patients with hypertension (Joint 
     National Committee on Prevention, 1997), diabetes (Clark et 
     al., 2000), tobacco addition (Perez-Stable and Fuentes-
     Afflick, 1998), hyperlipidemia (McBride et al., 1998), 
     congestive heart failure (Ni et al., 1998), chronic atrial 
     fibrillation (Samsa et al., 2000), asthma (Legorreta et al., 
     2000), and depression (Young et al., 2001) are currently 
     managed inadequately. Among the Medicare-eligible population, 
     the average beneficiary sees 6.4 different physicians in a 
     year, 4.6 of those being in the outpatient setting (Anderson, 
     2002a).

[[Page 16620]]




    Cancer Screening That is Evidence-Based--Rationale for Selection

                                 Impact

       Colorectal cancer is the third most common cancer among men 
     and women in the United States, with an estimated incidence 
     of 148,300 cases annually. In 2002, 56,600 Americans died 
     from colorectal cancer, making it the nation's second leading 
     cause of cancer-related death. Lifetime risk for developing 
     colorectal cancer is approximately 6 percent with over 90 
     percent of cases occurring after age 50 (American Cancer 
     Society, 2002). The estimated long-term cost of treating 
     stage II colon cancer is approximately $60,000 (Brown et al., 
     2002).
       Cervical cancer is the ninth most common cancer among women 
     in the United States, with an estimated incidence of 13,000 
     cases annually. Cervical cancer ranks thirteenth among all 
     causes of cancer death, with about 4,100 women dying of the 
     disease each year (American Cancer Society, 2002). The 
     incidence of cervical cancer has steadily declined, dropping 
     46 percent between 1975 and 1999 from a rate of 14.8 per 
     100,000 women to 8.0 per 100,000 women (Ries et al., 2002). 
     Despite these gains, cervical cancer continues to be a 
     significant public health issue. It has been estimated that 
     60 percent of cases of cervical cancer are due to a lack of 
     or deficiencies in screening (Sawaya and Grimes, 1999).


                      Prevention--Cancer Screening

                             Improvability

       Early diagnosis of colorectal cancer while it is still at a 
     localized state results in a 90 percent survival rate at 5 
     years (Ries et al., 2002). The American Cancer Society's 
     (ACS) guidelines recommend screening for colorectal cancer 
     beginning at age 50 for adults at average risk using one of 
     the following five screening regimens: fecal occult blood 
     test (FOBT) annually; flexible sigmoidoscopy every 5 years; 
     annual FOBT plus flexible sigmoidoscopy every 5 years; double 
     contrast barium enema every 5 years; or colonoscopy every 10 
     years (American Cancer Society, 2001). The United States 
     Preventive Services Task Force strongly recommends screening 
     for men and women 50 years of age and or older for colorectal 
     cancer. Screening has been found to be cost-effective in 
     saving lives, with estimates ranging from $10,000 and $25,000 
     life-year saved.


             immunization (adult)--rationale for selection

                                 Impact

       Pneumonia and influenza are the seventh leading cause of 
     death in the United States (The Commonwealth Fund, 2002). 
     Pneumococcal disease causes 10,000 to 14,000 deaths annually; 
     influenza causes an average of 110,000 hospitalizations and 
     20,000 deaths annually (United States Department of Health 
     and Human Services, 2000). Approximately 30-43 percent of 
     elderly people who have invasive pneumonia will die from the 
     disease (United States Preventive Services Task Force, 1996). 
     The elderly are also at increased risk for complications 
     associated with influenza, and approximately 90 percent of 
     the deaths attributed to the disease are among those aged 65 
     and older (Vishnu-Priya et al., 2000).
       To decrease the burden of these diseases, including 
     incapacitating malaise, doctor visits, hospitalizations, and 
     premature deaths, experts recommend vaccination. Yet one-
     third to one-half of older adults (aged 65 and over) do not 
     receive these vaccinations (The Commonwealth Fund, 2002). 
     Coverage rates for high-risk adults who suffer from chronic 
     disease are especially poor, with only 26 percent receiving 
     an influenza vaccination and 13 percent a pneumococcal 
     vaccination (Institute of Medicine, 2000).

  Mr. KENNEDY. Mr. President, I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The legislative clerk proceeded to call the roll.
  Mr. McCONNELL. Mr. President, I ask unanimous consent that the order 
for the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.


                           Amendment No. 1097

  Mr. McCONNELL. Mr. President, I send an amendment to the desk and ask 
for its immediate consideration.
  The PRESIDING OFFICER. The clerk will report the amendment.
  The legislative clerk read as follows:

       The Senator from Kentucky [Mr. McConnell] proposes an 
     amendment numbered 1097.

  Mr. McCONNELL. Mr. President, I ask unanimous consent that reading of 
the amendment be dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The amendment is as follows:

               (Purpose: To protect seniors with cancer)

       At the end of subtitle A of title I, add the following:

     SEC. __. PROTECTING SENIORS WITH CANCER.

       Any eligible beneficiary (as defined in section 1860D(3) of 
     the Social Security Act) who is diagnosed with cancer shall 
     be protected from high prescription drug costs in the 
     following manner:
       (1) Subsidy eligible individuals with an income below 100 
     percent of the federal poverty line.--If the individual is a 
     qualified medicare beneficiary (as defined in section 1860D-
     19(a)(4) of such Act), such individual shall receive the full 
     premium subsidy and reduction of cost-sharing described in 
     section 1860D-19(a)(1) of such Act, including the payment 
     of--
       (A) no deductible;
       (B) no monthly beneficiary premium for at least one 
     Medicare Prescription Drug plan available in the area in 
     which the individual resides; and
       (C) reduced cost-sharing described in subparagraphs (C), 
     (D), and (E) of section 1860D-19(a)(1) of such Act.
       (2) Subsidy eligible individuals with an income between 100 
     and 135 percent of the federal poverty line.--If the 
     individual is a specified low income medicare beneficiary (as 
     defined in paragraph 1860D-19(4)(B) of such Act) or a 
     qualifying individual (as defined in paragraph 1860D-19(4)(C) 
     of such Act) who is diagnosed with cancer, such individual 
     shall receive the full premium subsidy and reduction of cost-
     sharing described in section 1860D-19(a)(2) of such Act, 
     including payment of--
       (A) no deductible;
       (B) no monthly premium for any Medicare Prescription Drug 
     plan described paragraph (1) or (2) of section 1860D-17(a) of 
     such Act; and
       (C) reduced cost-sharing described in subparagraphs (C), 
     (D), and (E) of section 1860D-19(a)(2) of such Act.
       (3) Subsidy-eligible individuals with income between 135 
     percent and 160 percent of the federal poverty level.--If the 
     individual is a subsidy-eligible individual (as defined in 
     section 1860D-19(a)(4)(D) of such Act) who is diagnosed with 
     cancer, such individual shall receive sliding scale premium 
     subsidy and reduction of cost-sharing for subsidy-eligible 
     individuals, including payment of--
       (A) for 2006, a deductible of only $50;
       (B) only a percentage of the monthly premium (as described 
     in section 1860D-19(a)(3)(A)(i)); and
       (C) reduced cost-sharing described in clauses (iii), (iv), 
     and (v) of section 1860D-19(a)(3)(A).
       (4) Eligible beneficiaries with income above 160 percent of 
     the federal poverty level.--If an individual is an eligible 
     beneficiary (as defined in section 1860D(3) of such Act), is 
     not described in paragraphs (1) through (3), and is diagnosed 
     with cancer, such individual shall have access to qualified 
     prescription drug coverage (as described in section 1860D-
     6(a)(1) of such Act), including payment of--
       (A) for 2006, a deductible of $275;
       (B) the limits on cost-sharing described section 1860D-
     6(c)(2) of such Act up to, for 2006, an initial coverage 
     limit of $4,500; and
       (C) for 2006, an annual out-of-pocket limit of $3,700 with 
     10 percent cost-sharing after that limit is reached.
       (5) Construction.--Notwithstanding the preceding provisions 
     of this section, nothing in this section shall be construed 
     in a manner that would provide an individual who is diagnosed 
     with cancer with benefits under part D of title XVIII of the 
     Social Security Act (as added by section 101) that are 
     different from the benefits that the individual would have 
     been eligible for if such individual was not diagnosed with 
     cancer.

  Mr. McCONNELL. Mr. President, the amendment I just sent to the desk 
ensures protection of seniors diagnosed with cancer from the high 
prescription drug costs associated with that illness.
  My amendment states specifically that any senior in Medicare and 
diagnosed with cancer shall have the right to a drug plan in which the 
beneficiary shall pay no deductible, no monthly premium, no more than a 
2.5-percent copayment for any drug spending up to $4,500 a year, no 
more than a 5-percent copayment for drug spending between $4,500 and 
$5,800 a year, and no more than a 2.5-percent copayment for any drug 
spending over $5,800 if their income is below the poverty level.
  My amendment states that any senior in Medicare who is also diagnosed 
with cancer, with an income between 100 percent and 135 percent of the 
poverty level, shall have the right to a drug plan in which the 
beneficiary shall pay no deductible, no monthly premium, no more than a 
5-percent copayment for drug spending up to $4,500, no more than a 10-
percent copayment for drug spending between $4,500 and $5,800, and no 
more than a 2.5-percent copayment for any drug spending over $5,800.
  My amendment provides that any senior in Medicare diagnosed with 
cancer, with an income between 135 percent and 160 percent of the 
poverty level, shall have the right to a drug plan in which the 
beneficiary shall pay

[[Page 16621]]

no more than a $50 deductible, an average monthly premium not greater 
than $35, no more than a 10-percent copayment for drug spending up to 
$4,500, no more than a 20-percent copayment for drug spending between 
$4,500 and $5,800, and no more than a 10-percent copayment for any drug 
spending over $5,800.
  My amendment also provides that any senior in Medicare and diagnosed 
with cancer, with an income above 160 percent of the poverty level, 
shall have the right to a drug plan in which the beneficiary shall pay 
no more than a $275 deductible, an average monthly premium not greater 
than $35, no more than a 50-percent copayment for drug spending up to 
$4,500, and no more than a 10-percent copayment for drug spending over 
$5,800.
  With this amendment, which conforms to the provisions within the 
bill, all seniors with cancer get help with prescription drug costs, 
especially the poor and moderate-income seniors.
  Mr. President, how much time do I have remaining?
  The PRESIDING OFFICER. Two minutes.
  Mr. McCONNELL. Mr. President, I reserve the remainder of my time.
  The PRESIDING OFFICER. Who yields time?
  The Senator from Nevada.
  Mr. REID. Mr. President, the Boxer amendment is very simple. It says 
if a person is receiving cancer drugs and they come to a period of 
time--as this bill is written--where they run out of the ability to get 
help from the Medicare Program, that they, in effect, are covered.
  We want a cancer patient to have no donut hole, no gap in coverage. 
That is what the Boxer amendment is all about.
  Mr. KENNEDY. Mr. President, do we have any time?
  Mr. REID. We have at least 4 minutes.
  Mr. KENNEDY. Will the Senator yield me a minute?
  Mr. REID. Of course.
  The PRESIDING OFFICER. The Senator from Massachusetts.
  Mr. REID. Mr. President, I yield 2 minutes to the Senator from 
Massachusetts.
  Mr. KENNEDY. Mr. President, the Boxer amendment provides the 
additional resources for the treatment of cancer. I think all of us 
understand the importance of the continuity of care in the treatment of 
disease generally. That is why I am going to continue to vigorously 
fight for additional resources to fill in this gap in the future for 
all diseases. But it is particularly important to fill this gap for 
people who are afflicted with the disease of cancer. They are waiting 
for Congress to fill in this gap.
  It does seem to me, because of the compelling reasons for the 
continuity of care in terms of diseases generally we ought to be able 
to find the additional resources to fill this gap.
  The Boxer amendment does not replace the fundamental structure of 
this legislation. It finds the additional resources to be able to make 
sure there will be continuity of care for what is, for many families, 
their Number 1 health concern. So that is a very compelling reason. I 
hope the amendment will be favorably considered.
  I suggest the absence of a quorum.
  Mr. REID. Mr. President, I ask the Senator to withhold the suggestion 
of a quorum.
  Mr. KENNEDY. I withhold.
  The PRESIDING OFFICER. Who yields time?
  If no one yields time, time will be charged equally to both sides.
  Who yields time?
  The minority leader.
  Mr. DASCHLE. Mr. President, I ask unanimous consent that all time be 
yielded back.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The question is on agreeing to the McConnell amendment No. 1097.
  Mr. McCONNELL. I ask for the yeas and nays.
  The PRESIDING OFFICER. Is there a sufficient second?
  There is a sufficient second. The clerk will call the roll.
  The legislative clerk called the roll.
  Mr. REID. I announce that the Senator from Massachusetts (Mr. Kerry) 
and the Senator from Connecticut (Mr. Lieberman) are necessarily 
absent.
  I further announce that, if present and voting, the Senator from 
Massachusetts (Mr. Kerry), would vote ``yea.''
  The PRESIDING OFFICER (Mr. Burns). Are there any other Senators in 
the Chamber desiring to vote?
  The result was announced--yeas 97, nays 1, as follows:

                      [Rollcall Vote No. 249 Leg.]

                                YEAS--97

     Akaka
     Alexander
     Allard
     Allen
     Baucus
     Bayh
     Bennett
     Biden
     Bingaman
     Bond
     Boxer
     Breaux
     Brownback
     Bunning
     Burns
     Byrd
     Campbell
     Cantwell
     Carper
     Chafee
     Chambliss
     Clinton
     Cochran
     Coleman
     Collins
     Conrad
     Cornyn
     Corzine
     Craig
     Crapo
     Daschle
     Dayton
     DeWine
     Dodd
     Dole
     Domenici
     Dorgan
     Durbin
     Edwards
     Enzi
     Feingold
     Feinstein
     Fitzgerald
     Frist
     Graham (FL)
     Graham (SC)
     Grassley
     Gregg
     Hagel
     Harkin
     Hatch
     Hollings
     Hutchison
     Inhofe
     Inouye
     Jeffords
     Johnson
     Kennedy
     Kohl
     Kyl
     Landrieu
     Lautenberg
     Leahy
     Levin
     Lincoln
     Lott
     Lugar
     McCain
     McConnell
     Mikulski
     Miller
     Murkowski
     Murray
     Nelson (FL)
     Nelson (NE)
     Nickles
     Pryor
     Reed
     Reid
     Roberts
     Rockefeller
     Santorum
     Sarbanes
     Schumer
     Sessions
     Shelby
     Smith
     Snowe
     Specter
     Stabenow
     Stevens
     Sununu
     Talent
     Thomas
     Voinovich
     Warner
     Wyden

                                NAYS--1

       
     Ensign
       

                             NOT VOTING--2

     Kerry
     Lieberman
       
  The amendment (No. 1097) was agreed to.


                           Amendment No. 1036

  The PRESIDING OFFICER (Mr. Graham of South Carolina). By previous 
order, there are 2 minutes evenly divided prior to the vote on the 
Boxer amendment.
  The Senator from California is recognized.
  Mrs. BOXER. The Senator from Kentucky and I agreed to an extra 30 
seconds each, so I ask unanimous consent for that.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mrs. BOXER. Mr. President, I want to speak to the hearts and the 
minds of each and every one of my colleagues and friends, so I will 
speak straight from the shoulder.
  The amendment we just voted for did nothing, not one thing, for 
cancer patients, except reiterate what is already in the underlying 
bill.
  What my amendment does, and why I hope we will rise to the occasion 
and support it, is to send a strong message to anyone diagnosed with 
cancer, and to their families, friends, and loved ones, that if and 
when they are diagnosed with cancer, they will not face the benefit 
shutdown that is now in this bill.
  I will show my colleagues on this chart that at $4,500 of drug costs, 
the benefit shuts down. I want my colleagues to think about someone 
they know with cancer, someone who is battling cancer. Do we want to 
put this burden on them? They must take their drugs. They cannot cut 
their pills in half in order to survive.
  The Cancer Society tells us that 6 million to 7 million Medicare 
beneficiaries are battling some form of cancer, and 380,000 of them 
will die of cancer. Please, let us relieve this burden of them having 
to pay 100 percent of their drug costs during this benefit shutdown. I 
beg my colleagues to take a stand. I beg my colleagues to be 
compassionate. I beg my colleagues to be independent for once on an 
amendment and support the cancer patients who are counting on us today 
to at least relieve them of this terrible financial burden that will 
hit them just when they are the sickest.
  I urge an aye vote.
  The PRESIDING OFFICER. The Senator from Iowa.
  Mr. GRASSLEY. Before I use my time, I have a unanimous consent 
request. That unanimous consent request is that the time lapse between 
the next two votes be 10 minutes instead of 15 minutes.

[[Page 16622]]

  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. GRASSLEY. Mr. President, first, from a parliamentary point of 
view, this amendment, if adopted, would subject the entire bill to a 
budget point of order. We have enough people in this body who maybe do 
not want a prescription drug bill that could take down the whole bill.
  The other reason is, all the concerns the Senator has mentioned we 
have taken into account within the $400 billion capability of our 
legislation. We have before us this $400 billion to provide 
prescription drug benefits to our seniors. We have used that $400 
billion to help low-income seniors with prescription drug costs if they 
have cancer, diabetes, or anything else for which they need drugs.
  We have used the $400 billion to limit the catastrophic costs of 
prescription drugs to all seniors. We do not create two drug classes 
for the sick and the ill, and that is why we should move forward with 
this amendment so it does not bring down the whole bill on a potential 
budget point of order.
  I move to table the amendment, and I ask for the yeas and nays.
  The PRESIDING OFFICER. All time has expired. Is there a sufficient 
second?
  There appears to be a sufficient second.
  The question is on agreeing to the motion.
  The clerk will call the roll.
  The bill clerk called the roll.
  Mr. REID. I announce that the Senator from Massachusetts (Mr. Kerry) 
and the Senator from Connecticut (Mr. Lieberman) are necessarily 
absent.
  I further announce that, if present and voting, the Senator from 
Massachusetts (Mr. Kerry) would vote ``nay''.
  The PRESIDING OFFICER. Are there any other Senators in the Chamber 
desiring to vote?
  The result was announced--yeas 54, nays 44, as follows:

                      [Rollcall Vote No. 250 Leg.]

                                YEAS--54

     Alexander
     Allard
     Allen
     Baucus
     Bennett
     Bond
     Breaux
     Brownback
     Bunning
     Burns
     Campbell
     Chafee
     Chambliss
     Cochran
     Coleman
     Collins
     Cornyn
     Craig
     Crapo
     DeWine
     Dole
     Domenici
     Ensign
     Enzi
     Fitzgerald
     Frist
     Graham (SC)
     Grassley
     Gregg
     Hagel
     Hatch
     Hutchison
     Inhofe
     Kyl
     Lott
     Lugar
     McCain
     McConnell
     Miller
     Murkowski
     Nickles
     Roberts
     Santorum
     Sessions
     Shelby
     Smith
     Snowe
     Specter
     Stevens
     Sununu
     Talent
     Thomas
     Voinovich
     Warner

                                NAYS--44

     Akaka
     Bayh
     Biden
     Bingaman
     Boxer
     Byrd
     Cantwell
     Carper
     Clinton
     Conrad
     Corzine
     Daschle
     Dayton
     Dodd
     Dorgan
     Durbin
     Edwards
     Feingold
     Feinstein
     Graham (FL)
     Harkin
     Hollings
     Inouye
     Jeffords
     Johnson
     Kennedy
     Kohl
     Landrieu
     Lautenberg
     Leahy
     Levin
     Lincoln
     Mikulski
     Murray
     Nelson (FL)
     Nelson (NE)
     Pryor
     Reed
     Reid
     Rockefeller
     Sarbanes
     Schumer
     Stabenow
     Wyden

                             NOT VOTING--2

     Kerry
     Lieberman
      
  The motion was agreed to.


                           Amendment No. 1065

  The PRESIDING OFFICER. There are now 2 minutes equally divided prior 
to the vote on the amendment offered by the Senator from New Mexico.
  The Senate will please be in order. The Senator from New Mexico will 
suspend until the Senate is in order.
  The Senator from New Mexico.
  Mr. BINGAMAN. I ask unanimous consent that the Record reflect we are 
updating the asset test to a limit of $10,000 per individual and 
$20,000 per couple.
  The PRESIDING OFFICER. Is there objection?
  Mr. GRASSLEY. Reserving the right to object, have we seen this? We do 
not seem to know about this.
  The PRESIDING OFFICER. The Senate will be in order.
  Mr. GRASSLEY. Reserving the right to object, we do not know about the 
modification--or do we? We do not seem to.
  Mr. BINGAMAN. Mr. President, this is what the bill was intended to 
say. It is exactly what we have shared with your staff. It is just that 
there was a typo in it.
  Mr. GRASSLEY. I withdraw the reservation.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The Senator from New Mexico.
  Mr. BINGAMAN. I ask unanimous consent that the Senator from Florida, 
Mr. Graham, be added as a cosponsor.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. BINGAMAN. I also ask unanimous consent that we be allowed 2 
minutes to advocate for the amendment and the opposition get 2 minutes 
as well.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. BINGAMAN. Mr. President, I will take one of those 2 minutes and 
Senator Domenici the other.
  This is a Bingaman-Domenici amendment. The purpose of it is not to 
eliminate the asset test. That was an earlier amendment I offered and 
then withdrew. Instead, it is to update the asset test, where you would 
still be required to demonstrate that your income was below poverty or 
in that range, but instead of having to demonstrate that your total 
combined assets were only $4,000, you would be able to show that they 
were less than $10,000.
  This also eliminates the paperwork burden that currently is imposed 
in most States on people who are required to itemize their assets and 
essentially provide a full financial statement to get the full low-
income benefit.
  We think this is a needed update on the asset test. It will allow a 
lot more people to get the full benefit.
  I yield the remaining time to Senator Domenici.
  Mr. DOMENICI. Mr. President, this is a very simple amendment. I 
believe it is absolutely fair and nothing more than simple equity. We 
have had an asset test under Medicaid, which applies here, since 1988. 
It is $4,000. That means there is an income test and an asset test of 
$4,000. I believe the time has come to change that $4,000 to something 
more reasonable--not gigantic, just $10,000. It says the income test 
still applies, but you can own assets up to $10,000.
  It also says you do not have to fill out all kinds of forms. You can 
sign an affidavit under penalty of felony, as to what your assets are, 
and that suffices. If there is anything this bill needs it is 
simplicity. So this adds simplicity to this form. But most of all, for 
the poor people, it permits them to own a car today. You know, hardly 
any cars are worth less than $4,000. I think you can be poverty 
stricken and still own an automobile.
  The PRESIDING OFFICER. The time of the Senator has expired.
  Mr. DOMENICI. I believe the amendment should be adopted.
  The PRESIDING OFFICER. The Senate will come to order.
  The Senator from Maine.
  Ms. SNOWE. Mr. President, I urge my colleagues to vote against the 
amendment offered by Senator Bingaman. We are not here to alter the 
guidelines for the Medicaid Program because it certainly would have an 
impact on the underlying Medicaid Program.
  Let me be clear. We did not create a new asset test for this benefit. 
We followed the asset test that exists in current law and that governs 
existing low-income assistance programs under Medicaid and Medicare.
  Actually, we learned our lesson from the last debate last fall on the 
tripartisan bill. We realized in constructing that approach that we 
excluded 40 percent of low-income Medicare beneficiaries. So this time 
we built on the existing Medicaid and Medicare Programs. We created a 
new program for those under 160 percent of the poverty level that has 
no asset test. By doing so, we capture 8.5 million more Medicare 
beneficiaries for a total of 17.5 million Medicare beneficiaries or 43 
percent of the overall program.
  We target our assistance, the most assistance to those most in need. 
So it is important for our colleagues to understand, we are using asset 
tests that already exist in current law to maximize the most assistance 
to those most in need of this benefit.

[[Page 16623]]

  Mr. President, I ask for the yeas and nays.
  The PRESIDING OFFICER. Is there a sufficient second?
  There is a sufficient second.
  The question is on agreeing to the amendment.
  The clerk will call the roll.
  The assistant legislative clerk called the roll.
  Mr. REID. I announce that the Senator from Massachusetts (Mr. Kerry) 
and the Senator from Connecticut (Mr. Lieberman) are necessarily 
absent.
  I further announce that, if present and voting, the Senator from 
Massachusetts (Mr. Kerry) would vote ``yea.''
  The PRESIDING OFFICER. Are there any other Senators in the Chamber 
desiring to vote?
  The result was announced--yeas 69, nays 29, as follows:

                      [Rollcall Vote No. 251 Leg.]

                                YEAS--69

     Akaka
     Alexander
     Allen
     Baucus
     Bayh
     Bennett
     Biden
     Bingaman
     Boxer
     Breaux
     Brownback
     Byrd
     Campbell
     Cantwell
     Carper
     Chafee
     Chambliss
     Clinton
     Coleman
     Collins
     Conrad
     Corzine
     Daschle
     Dayton
     DeWine
     Dodd
     Domenici
     Dorgan
     Durbin
     Edwards
     Ensign
     Feingold
     Feinstein
     Graham (FL)
     Graham (SC)
     Hagel
     Harkin
     Hollings
     Hutchison
     Inouye
     Jeffords
     Johnson
     Kennedy
     Kohl
     Landrieu
     Lautenberg
     Leahy
     Levin
     Lincoln
     Lugar
     McCain
     Mikulski
     Miller
     Murray
     Nelson (FL)
     Nelson (NE)
     Pryor
     Reed
     Reid
     Roberts
     Rockefeller
     Sarbanes
     Schumer
     Smith
     Specter
     Stabenow
     Stevens
     Warner
     Wyden

                                NAYS--29

     Allard
     Bond
     Bunning
     Burns
     Cochran
     Cornyn
     Craig
     Crapo
     Dole
     Enzi
     Fitzgerald
     Frist
     Grassley
     Gregg
     Hatch
     Inhofe
     Kyl
     Lott
     McConnell
     Murkowski
     Nickles
     Santorum
     Sessions
     Shelby
     Snowe
     Sununu
     Talent
     Thomas
     Voinovich

                             NOT VOTING--2

     Kerry
     Lieberman
      
  The amendment (No. 1065) was agreed to.
  Mr. BINGAMAN. Mr. President, I move to reconsider the vote.
  I move to lay that motion on the table.
  The motion to lay on the table was agreed to.


                             Change of Vote

  Ms. LANDRIEU. Mr. President, on rollcall vote No. 251, I voted nay. I 
intended to vote yea. It does not change the outcome of the vote. I ask 
unanimous consent that the Record reflect as I have stated.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  (The foregoing tally has been changed to reflect the above order.)
  Mr. FRIST. Mr. President, I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mr. FRIST. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER (Mr. Bunning). Without objection, it is so 
ordered.
  Mr. FRIST. Mr. President, I ask unanimous consent that at 2:30 the 
Senate proceed to a vote in relation to a McConnell or designee 
amendment regarding Alzheimer's, to be followed immediately by a vote 
in relation to the Durbin amendment on the same subject, again, with no 
second degrees in order to either amendment prior to the votes; 
provided further that the Senate then proceed to a vote in relation to 
the Dorgan second-degree amendment on premiums to the Grassley-Baucus 
amendment No. 1092. Finally, I ask unanimous consent that following 
disposition of the Dorgan amendment, the Senate then proceed to a vote 
in relation to the underlying Grassley-Baucus amendment, with no other 
amendments in order to amendment No. 1092 other than the mentioned Kyl 
and Dorgan amendments. I also ask unanimous consent that there be 2 
minutes equally divided for debate between each of the votes in this 
series as well.
  Mr. REID. Reserving the right to object, everyone here is working in 
the best of faith to try to work through this situation. We don't have 
the actual document of the Durbin amendment. I have been told what is 
in that. I related that to the majority and to the two managers of the 
bill. It is very similar to the Boxer amendment. If it is anything 
different than that, I will make sure that we vitiate this agreement.
  Mr. McCONNELL. So if the Durbin amendment is other than we 
anticipate, I will obviously reserve the right to modify mine as well.
  Mr. REID. Absolutely.
  Mr. DORGAN. Mr. President, reserving the right to object, I ask the 
majority leader if in the period between now and when the first vote 
occurs, there will be provided 30 minutes for the offering and 
discussion of my amendment. I had previously talked with the Senator 
from Nevada. Senator Pryor and I wish to be recognized for 30 minutes 
to offer our amendment. I simply ask if that timeframe allows that 
opportunity so that we have 30 minutes of debate.
  Mr. McCONNELL. Mr. President, I would like to make sure I am 
protected to lay down my amendment now.
  The PRESIDING OFFICER. The Senator from Nevada has the floor.
  Mr. REID. Mr. President, we have approximately an hour and a half. I 
would ask, as Senator Dorgan asked earlier, that he and Senator Pryor 
be given 30 minutes of that hour and a half, and Senator Durbin be 
given a half hour.
  The PRESIDING OFFICER. The majority leader has the floor.
  Mr. FRIST. Mr. President, I yield to the Senator from Kentucky.
  Mr. McCONNELL. Mr. President, we are talking about how to divide up 
an hour and a half. How about a consent that we divide the time 
equally?
  Mr. REID. That will be fine. I ask unanimous consent that the 
agreement give each side an extra 5 minutes, so the vote would occur at 
2:40, rather than 2:30, and the time be divided equally.
  The PRESIDING OFFICER. Is there objection?
  Mr. DORGAN. Reserving the right to object, I don't care what the vote 
is. Senator Pryor and I wish to speak for 30 minutes. If that is not 
provided for in the unanimous consent, I will object.
  Mr. REID. That is fine on this side.
  Mr. FRIST. Mr. President, we have no objection.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The PRESIDING OFFICER. The Senator from Kentucky is recognized.


                           Amendment No. 1102

  Mr. McCONNELL. Mr. President, pursuant to the consent agreement just 
entered into, I send an amendment to the desk.
  The PRESIDING OFFICER. The clerk will report.
  The assistant legislative clerk read as follows:

       The Senator from Kentucky [Mr. McConnell] proposes an 
     amendment numbered 1102.

  Mr. McCONNELL. Mr. President, I ask unanimous consent that further 
reading of the amendment be dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The amendment is as follows:

         (Purpose: To protect seniors with Alzheimer's disease)

       At the end of subtitle A of title I, add the following:

     SEC. __. PROTECTING SENIORS WITH ALZHEIMER'S DISEASE.

       Any eligible beneficiary (as defined in section 1860D(3) of 
     the Social Security Act) who is diagnosed with Alzheimer's 
     disease shall be protected from high prescription drug costs 
     in the following manner:
       (1) Subsidy eligible individuals with an income below 100 
     percent of the federal poverty line.--If the individual is a 
     qualified medicare beneficiary (as defined in section 1860D-
     19(a)(4) of such Act), such individual shall receive the full 
     premium subsidy and reduction of cost-sharing described in 
     section 1860D-19(a)(1) of such Act, including the payment 
     of--
       (A) no deductible;
       (B) no monthly beneficiary premium for at least one 
     Medicare Prescription Drug plan available in the area in 
     which the individual resides; and

[[Page 16624]]

       (C) reduced cost-sharing described in subparagraphs (C), 
     (D), and (E) of section 1860D-19(a)(1) of such Act.
       (2) Subsidy eligible individuals with an income between 100 
     and 135 percent of the federal poverty line.--If the 
     individual is a specified low income medicare beneficiary (as 
     defined in paragraph 1860D-19(4)(B) of such Act) or a 
     qualifying individual (as defined in paragraph 1860D-19(4)(C) 
     of such Act) who is diagnosed with Alzheimer's disease, such 
     individual shall receive the full premium subsidy and 
     reduction of cost-sharing described in section 1860D-19(a)(2) 
     of such Act, including payment of--
       (A) no deductible;
       (B) no monthly premium for any Medicare Prescription Drug 
     plan described paragraph (1) or (2) of section 1860D-17(a) of 
     such Act; and
       (C) reduced cost-sharing described in subparagraphs (C), 
     (D), and (E) of section 1860D-19(a)(2) of such Act.
       (3) Subsidy-eligible individuals with income between 135 
     percent and 160 percent of the federal poverty level.--If the 
     individual is a subsidy-eligible individual (as defined in 
     section 1860D-19(a)(4)(D) of such Act) who is diagnosed with 
     Alzheimer's disease, such individual shall receive sliding 
     scale premium subsidy and reduction of cost-sharing for 
     subsidy-eligible individuals, including payment of--
       (A) for 2006, a deductible of only $50;
       (B) only a percentage of the monthly premium (as described 
     in section 1860D-19(a)(3)(A)(i)); and
       (C) reduced cost-sharing described in clauses (iii), (iv), 
     and (v) of section 1860D-19(a)(3)(A).
       (4) Eligible beneficiaries with income above 160 percent of 
     the federal poverty level.--If an individual is an eligible 
     beneficiary (as defined in section 1860D(3) of such Act), is 
     not described in paragraphs (1) through (3), and is diagnosed 
     with Alzheimer's disease, such individual shall have access 
     to qualified prescription drug coverage (as described in 
     section 1860D-6(a)(1) of such Act), including payment of--
       (A) for 2006, a deductible of $275;
       (B) the limits on cost-sharing described section 1860D-
     6(c)(2) of such Act up to, for 2006, an initial coverage 
     limit of $4,500; and
       (C) for 2006, an annual out-of-pocket limit of $3,700 with 
     10 percent cost-sharing after that limit is reached.

  Mr. McCONNELL. Mr. President, very briefly, the amendment I just sent 
to the desk ensures protection of seniors diagnosed with Alzheimer's 
from the high prescription drug costs associated with that illness.
  My amendment states specifically that any senior on Medicare 
diagnosed with Alzheimer's shall have the right to a drug plan in which 
the beneficiary shall pay no deductible, no monthly premium, no more 
than a 2.5-percent copayment for drug spending up to $4,500, no more 
than a 5-percent copayment for drug spending between $4,500 and $5,800, 
and no more than a 2.5-percent copayment for any drug spending over 
$5,800 if their income is below the poverty level.
  My amendment states that any senior on Medicare diagnosed with 
Alzheimer's with an income between 100 and 135 percent of the poverty 
level shall have the right to a drug plan in which the beneficiary 
shall pay no deductible, no monthly premium, and no more than a 5-
percent copayment for drug spending up to $4,500, no more than a 10-
percent copayment for drug spending between $4,500 and $5,800, and no 
more than a 2.5-percent copayment for any drug spending over $5,800.
  My amendment provides that any senior in Medicare diagnosed with 
Alzheimer's with an income between 135 percent and 160 percent of the 
poverty level shall have the right to a drug plan in which the 
beneficiary shall pay no more than a $50 deductible, an average monthly 
premium not greater than $35, no more than a 10-percent copayment for 
drug spending up to $4,500, no more than a 20-percent copayment for 
drug spending between $4,500 and $5,800, and no more than a 10-percent 
copayment for any drug spending above $5,800.
  My amendment also provides that any senior on Medicare diagnosed with 
Alzheimer's with an income above 160 percent of the poverty level shall 
have the right to a drug plan in which the beneficiary shall pay no 
more than a $275 deductible, an average monthly premium not greater 
than $35, no more than a 50-percent copayment for drug spending up to 
$4,500, and no more than a 10-percent copayment for drug spending over 
$5,800.
  With this amendment, which conforms to the provisions within the 
bill, all seniors with Alzheimer's get help with drug costs, especially 
the poor and moderate-income seniors.
  I yield the floor.
  The PRESIDING OFFICER. Who yields time? The Senator from Iowa.


                      Amendment No. 1093 Withdrawn

  Mr. GRASSLEY. Mr. President, I ask unanimous consent, on behalf of 
Senator Kyl, to withdraw the Kyl amendment to the Grassley amendment.
  The PRESIDING OFFICER. Is there objection? Without objection, it is 
so ordered.
  Mr. REID. Mr. President, I ask unanimous consent that the Dorgan 
amendment be offered now and the pending amendment be set aside.
  The PRESIDING OFFICER. Is there objection? Without objection.
  The Senator from North Dakota.


                Amendment No. 1103 to Amendment No. 1092

  Mr. DORGAN. Mr. President, I send an amendment to the desk and ask 
for its immediate consideration.
  The PRESIDING OFFICER. The clerk will report.
  The assistant legislative clerk read as follows:

       The Senator from North Dakota [Mr. Dorgan] for himself and 
     Mr. Pryor, proposes an amendment numbered 1103.

  Mr. DORGAN. Mr. President, I ask unanimous consent that further 
reading of the amendment be dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The amendment is as follows:

(Purpose: To reduce aggregate beneficiary obligations by $2,400,000,000 
                      per year beginning in 2009)

       In lieu of the matter proposed to be inserted, insert the 
     following:

     SEC. __. AGGREGATE REDUCTION IN MONTHLY BENEFICIARY 
                   OBLIGATIONS.

       Section 1860D-17, as added by section 101, is amended by 
     adding at the end the following:
       ``(d) Aggregate Reduction in Monthly Beneficiary 
     Obligations.--The Administrator shall for each year 
     (beginning with 2009) determine a percentage which--
       ``(1) shall apply in lieu of the applicable percent 
     otherwise determined under subsection (c) for that year, and
       ``(2) will result in a decrease of $2,400,000,000 for that 
     year in the aggregate monthly beneficiary obligations 
     otherwise required of all eligible beneficiaries enrolled in 
     a Medicare Prescription Drug Plan or a Medicare Advantage 
     plan that provides qualified prescription drug coverage.
     This subsection shall not apply in determining the applicable 
     percent under subsection (c) for purposes of section 1860D-
     21.''.

  Mr. DORGAN. Mr. President, this is an amendment that deals with the 
question of what to do about the $12 billion of remaining available out 
of the $400 billion Congress set aside for a prescription drug benefit 
plan in the Medicare Program. According to CBO, the underlying bill is 
$12 billion of that $400 billion, so what do we do with that $12 
billion? If the bill on the floor of the Senate to add prescription 
drugs to the Medicare Program costs $388 billion, and we have allocated 
$400 billion, the question is, what do you do with the other $12 
billion? So we had a group of people--I am not quite sure who they 
were--negotiate over a period of time, and they have now developed a 
plan for what to do with the $12 billion.
  By far, the simplest, most direct, and most appropriate use of the 
$12 billion would be to improve the prescription drug benefit for 
Medicare recipients. After all, that is why we are here. That is the 
purpose of this discussion and debate. That is the purpose of writing 
this legislation--to provide a prescription drug benefit to the 
Medicare Program that serves the interests of our senior citizens.
  Regrettably, the Grassley amendment before us, to which I have just 
offered a second-degree amendment, does not accomplish those goals. So 
I offer an amendment that is very simple. It says let's try to improve 
this prescription drug benefit plan for senior citizens with the $12 
billion that is available.
  Let me just mention a word generally about Medicare. We have people 
on the floor of the Senate who don't like Medicare. They don't say it, 
I know. One of their colleagues said it yesterday in New York City. It 
is the only flash of candid comment that I have seen recently. 
Congressman Thomas, in the New York Times, dated 6/26, says:

       Some of our friends on the other side of the aisle are 
     saying that if this bill becomes law

[[Page 16625]]

     [meaning the Medicare prescription drug bill] it will be the 
     end of Medicare as we know it. Our answer to that is, we 
     certainly hope so.

  Let me read it again so we understand what he is saying: ``Some of 
our friends [Democrats, he means] . . . are saying if this bill becomes 
law, it will be the end of Medicare as we know it. Our answer to that 
is, we certainly hope so.''
  When I was a young boy in a town of 400 people, my dad asked me to 
drive an old fellow to the hospital in Dickinson, ND. He was a man with 
a very serious health problem, and he had no relatives, had no vehicle, 
had no resources. So I was a teenager just about out of high school. I 
got him in my car and drove him to St. Joseph's Hospital in Dickinson, 
ND, and dropped him off there to be treated. He had a serious health 
problem but no insurance, no money, nothing.
  The fact is, that was at a period of time in the late 1950s and early 
1960s when a good many senior citizens had no capability to get health 
care. They had no insurance coverage. It wasn't the case that insurance 
companies were running after old folks to ask them: Can we please sell 
you a health insurance policy? They want to insure 22-year-olds--
healthy, vibrant, young 22-year-olds.
  That is where they make money. They don't make money by chasing 75-
year-old people and selling them health insurance policies. Back in the 
early 1960s, one-half of America's elderly had no health insurance--
none. None at all.
  Then along came Medicare. The Congress had a real debate about that. 
I wasn't here then, but you know there were naysayers who say no to 
everything for the first time. They said no, no, no; you cannot create 
Medicare. Well, we did create Medicare, and now 99 percent of the 
senior citizens in this country don't have to go to bed at night 
worrying about whether they can get medical care because they have 
health care coverage under Medicare. God bless them for that. They 
needed it, they deserved it, and this country provided it through the 
Medicare Program.
  Some say: We have incredible problems financing this program. Yes, we 
have some financial problems, no question about that. Do you know how 
we solve those problems? Go back to the old life expectancy. Go back 
100 years and, on average, you were expected to live to 48 years of age 
in this country. Now people live to 76 to 77 years of age.
  Life expectancy has increased dramatically in this country. That is 
good news. Our financing problems with Medicare are born of good news. 
People are living longer. Good for them. Good for us. Good for our 
country.
  Is it a problem to have good news? I do not think so. We will solve 
these issues. But even as we have done that, even as people are living 
longer and better lives, these new miracle medicines that have been 
created since Medicare was created are very expensive but very 
necessary for people to continue their lifestyle. And we have no 
prescription drug coverage in the Medicare Program.
  Clearly, if we wrote Medicare starting from scratch today, we would 
have prescription drug coverage. That is clear to everyone. But 
prescription drugs were not a key medical expense when Medicare was 
created, so now we have to put that coverage in the Medicare Program.
  Because some people do not like the Medicare Program--to wit my 
colleague, Congressman Thomas who said, ``certainly we hope this will 
be the end of Medicare as we know it,''--they want to privatize 
Medicare. Now, keep in mind that the private sector is the sector that 
would not insure old people in the first place, which is the reason why 
Congress had to develop the Medicare Program.
  That brings us back to this question of what to do with the $12 
billion. We are struggling to put together a benefit that means 
something to the people who need it. This is not theory. It is not a 
debate in the abstract. It is about some 85-year-old widow who, today, 
is going to the pharmacy in the back of a grocery store and trying to 
figure out how much her prescription drugs are going to cost so she can 
figure out how much money she has left for groceries. That is happening 
in a real sense today all across this country.
  We have $12 billion. We also have a bill that says to senior 
citizens: You pay $35 a month on an optional basis if you want this 
program of ours, and after $35 a month, you pay the first $275 in 
prescription drugs. Between $275 and $4,500, the Federal Government 
will help you by paying 50 percent of your prescription drug costs. And 
then between $4,500 and $5,800, there is what is famously called the 
donut hole, which means you receive no coverage.
  So you are not covered until you spend $275, then you are partially 
covered, then you are not covered again, and then you get catastrophic 
coverage. This is the most byzantine, complicated system we could 
possibly put together. It clearly is done by committee. We could not 
have done this so badly if it were done without a committee.
  Having said all of that, the question is, What do we do with the $12 
billion? We are told today, with the Grassley amendment, that we will 
provide $6 billion of the $12 billion to test a new alternative bidding 
system for paying PPOs--and if this is not complicated enough, just 
stay with me--that would reimburse these PPOs based on the median 
amount of the three lowest bids. There is nothing here that protects 
American taxpayers by ensuring we are not paying private health plans 
substantially more than traditional Medicare costs.
  Here is what it means in English. It means we are going to have an 
experiment with private sector delivery, but we are going to 
incentivize insurance companies. We are going to provide them some of 
this money so that they will actually want to offer this plan, so we 
can say at the end of it that somehow the plan is a good plan.
  We already know that does not work. My colleague, Senator Hollings, 
says there is no education in the second kick of a mule. We know this 
does not work. We know what happens. We know the Medicare Payment 
Advisory Committee, MedPAC, which is a nonpartisan committee that 
advises Congress on Medicare payment policies, says private plans cost 
15 percent more than traditional Medicare. We know that. We do not have 
to spend $6 billion giving money to private insurers to do an 
experiment. We know what does not work. We know the cost advantage of 
Medicare, and yet our colleagues continue to resist and continue to 
insist that we move Medicare beneficiaries into the private sector. And 
now with half of the $12 billion, they say let's do this little 
experiment.
  Will it enhance the health of senior citizens? No. Will it improve 
health care? No, not at all. Will it actually improve the underlying 
bill, improve the benefits, reduce the costs? No, not at all. This is 
just like a puppy dog following the master home. It is putting more and 
more money down this chute to pursue this dream of trying to 
demonstrate something we already know does not work.
  Mr. DURBIN. Will the Senator yield?
  Mr. DORGAN. I will be happy to yield.
  Mr. DURBIN. Do I understand that senior citizens, given the choice 
between traditional Medicare and Medicare HMOs, have already voted and 
that 88 or 89 percent of them want traditional Medicare; that they do 
not want to put their medical fate in the hands of these HMO private 
insurers who are unreliable, who may or may not cover the procedures 
they need? Haven't the seniors of this country, with their experience, 
already voted on this issue we are considering?
  Mr. DORGAN. Seniors have already made that judgment. They have 
already decided that. So we want to take $6 billion and give it to 
private health insurers at a time when Senators have been coming to the 
Chamber and saying we cannot improve this plan because we do not have 
any money. I have quotes of all the Senators, and I shall not name them 
all. I could read lots of quotes from the last 2 weeks of Senators. Why 
can't we improve it? Because we are limited by money. So now we have 
$12 billion more? That is what happens when you go into a room, shut

[[Page 16626]]

the door, make a little deal, and say this is how we want to use this 
money: We are going to take $6 billion and try an experiment that we 
failed at previously. It makes no sense to me. It is a byzantine 
failure, in my judgment, to do it this way.
  What I am proposing in my amendment is use the money to actually 
improve the program for senior citizens. We can drive down the cost of 
the prescription drug policies and improve the coverage.
  Mr. DURBIN. I ask the Senator, if he will yield further, is the 
Senator aware of a recent survey of seniors--over 600 across the United 
States--where they were told what this plan, S. 1, is all about? They 
said the fact that the $35 premium is not mandated in this law but is 
simply a suggestion; it may go higher; the fact private insurance 
companies that provide the prescription drug benefit may decide to 
change the benefit or go out of business every 2 years; the fact there 
is a $275 deductible and a huge gap in coverage for the sickness of the 
senior citizens--when they looked at all those items, is the Senator 
aware of the fact that most of the seniors, when asked, said they did 
not believe that S. 1 really answered the need in America that seniors 
are looking for?
  Mr. DORGAN. I know that is the case. I have seen the same survey to 
which the Senator referred. I think there are some provisions in this 
bill that have some merit. I prefer we do something rather than do 
nothing, but when we do something, let's do something right and 
something that benefits senior citizens. This is the case when you cite 
the polls, when you cite what our previous experience has been. It is a 
case, especially with respect to the use of this $6 billion, of the old 
joke from the movies: What are you going to believe, me or your own 
eyes?
  The fact is, we have already had these experiments. We understand how 
much additional costs are involved in the private sector delivery of 
this benefit, and we also know what Medicare does and how Medicare 
works. We know the private insurers have about a 14-percent overhead in 
administrative costs and delivering their service. We know that. We 
also know Medicare has about a 4-percent cost, a dramatic advantage.
  For that reason alone, you would want to provide this benefit through 
the traditional Medicare delivery system. Against all odds, we have 
people in this Chamber who, I guess, although they do not say it, 
believe along with Congressman Thomas that this bill ought to be the 
end of Medicare as we know it. Congressman Thomas said: Our answer to 
that is, we certainly hope so.
  Mr. DURBIN. I ask the Senator, is it possible Halliburton is going to 
pay some of these services with the six--I will withdraw that question. 
I ask the Senator, if one believes in privatization and competition, 
why does the private sector need a $6 billion subsidy to compete with 
Medicare? If they are good, if they are efficient, if they are customer 
friendly, why do they need this Federal subsidy of $6 billion to offer 
an attractive health care package to seniors?
  Mr. DORGAN. First, they do not need it, and no subsidy is warranted. 
The point of my amendment is to say if you have $12 billion, and they 
say let's take $6 billion and use it for an experiment that we know 
does not work, let's instead use that money to help seniors. Then the 
underlying amendment says let's take another $6 billion and test 
whether focusing on wellness will work, which we know it does work. We 
do not exactly have to have an experiment on that. Do things that 
promote wellness and the fact is you save money on the acute care side 
by not having people go into the hospital because they are taking care 
of themselves and have the kind of preventive care that is necessary to 
take care of themselves.
  I have another amendment pending. It has been pending for nearly a 
week. I hope it will be approved by the end of this process. It is a 
very inexpensive amendment that deals with that very kind of wellness 
approach.
  If senior citizens have heart disease, Medicare covers cholesterol 
screening. It makes sense, does it not? But Medicare does not cover 
cholesterol screening if one does not know they have heart disease. It 
does not make sense.
  Heart disease is our biggest killer in this country. We ought to 
cover cholesterol screening across the board. That is the way one can 
discover who is at risk for heart disease at a point when steps can be 
taken to prevent it. Yet Medicare does not cover that screening unless 
a person already has evidence of heart disease.
  There are many things we should do to improve Medicare's preventive 
coverage. My hope is that perhaps we will have that amendment approved 
before the end of this process.
  My colleague from Illinois talked about HMOs a moment ago. We are not 
in the trenches of the HMO debate as it was first envisioned by the 
White House, which said to senior citizens, here is a Faustian bargain: 
we will give you a prescription drug benefit but only if you enroll in 
an HMO. Talk about a goofy proposal; that is it.
  I have been talking about HMOs. There were some HMOs that did some 
good things, held down some prices. I understand that. But we have all 
also heard the stories of HMOs not taking good care of people. I guess 
we do not need to review the HMO stories about what happens to patients 
when profits were at stake. For instance, a woman falls off a cliff in 
the Shenandoah Mountains, sustains very serious head injuries and body 
injuries. She is hauled into an emergency room on a gurney in a coma. 
After a long convalescence, she finally gets out of the hospital only 
to be told by her HMO that they will not cover her emergency room 
treatment because she did not have prior approval to use the emergency 
room. This is a woman who is hauled in on a gurney in a coma.
  I will not revisit all of those HMO stories because it will take too 
much time, but I will say this: With Medicare, we know what works. Some 
of my colleagues make the case that it costs too much. Do my colleagues 
really know what costs too much in Medicare? It costs too much because 
people are living too long. What a wonderful set of victories we have 
in this country. With great health care, people are living longer.
  I probably should not talk about my uncle again, but I have an 81-
year-old uncle who runs the 400 meter and 800 meter in the Senior 
Olympics. He is probably out running today. He runs 3 miles a day at 81 
years old. Forty years ago, one reached 81 years old and they had to be 
in a chair someplace, but not any longer. People live longer, doing 
things no one ever expected them to do. And that includes my uncle. 
Good for them. Good for him. But because people live longer, Medicare 
costs more. That is not a sign of failure; it is a sign of success.
  Now we are trying to add to Medicare that which should have been 
added some long while ago: The miracle drugs that do provide miracles 
but only if one can afford them. We are talking about covering the 
drugs that keep seniors out of the hospital and they do not have to go 
into an acute care hospital bed. That is what we are dealing with.
  With this amendment, we are dealing with $12 billion. Instead of 
bifurcating it into two different experiments, one of which failed and 
one of which we do not need because we know the answer, what I propose 
we do is use that $12 billion to reduce from $43 to $38 the premium our 
senior citizens will have to pay for this prescription drug benefit, 
starting in 2009.
  There are people who live on $350 or $450 a month, their total income 
from their miserable little Social Security payment, who are living 
alone in a small town, are struggling to buy food, struggling to buy 
the necessities of life. There are people who have been told by their 
doctor: Oh, by the way, you have heart disease and diabetes, and here 
are the prescription drugs you need; and they sit at home knowing they 
do not have a penny to pay for those prescription medicines. Talk to 
those seniors and understand how important this coverage is. The 
coverage ought to be good and extensive coverage, and it ought to 
provide what we

[[Page 16627]]

know we should provide for senior citizens.
  Second, it ought to be done in an affordable way. Unfortunately, 
another weakness of this plan is that there is no defined benefit, 
which means the premiums can vary. The monthly premiums will increase 
year after year because we have not done enough to put downward 
pressure on prescription drug prices--and as prescription drug prices 
increase, the monthly premium will increase. The expectation is that 
the monthly premium starts at $35 and goes to $60 in a 10-year period. 
My amendment proposes about a $6 reduction in the monthly premium for 
senior citizens. That is a more effective way to use this $12 billion. 
Either that, or I would propose we extend the coverage through the 
$1,300 gap that exists in coverage, which I think would also represent 
a meritorious way of using this amount of money.
  My colleague, Senator Pryor from Arkansas, is in the Chamber and he 
may wish to address this issue as well. I have offered this amendment 
on behalf of myself and my colleague Senator Pryor, so I yield the 
floor in the hope that Senator Pryor will wish to make some comments as 
well.
  Mr. GRASSLEY. Mr. President, it is unfair for Members of the other 
side of the aisle to give us statistics that say 89 percent of the 
seniors are in for fee-for-service Medicare and only 11 percent are in 
Medicare+Choice and that is a nationwide average. It is an accurate 
statistic, but it does not speak to the seniors of America who like 
Medicare+Choice and I have figures from four cities--Miami, New York, 
San Francisco, and Chicago.
  In Miami, 45 percent of the senior citizens have chosen managed care, 
the Medicare+Choice option, as opposed to fee-for-service; New York, 22 
percent; San Francisco, 29 percent. In Chicago, it was only 6 percent. 
That may be one reason why Senator Durbin keeps bringing this up quite 
regularly. This data is from the Congressional Research Service, and it 
is as recent as March 2003.
  When people, wherever they are in the Senate, want to denigrate 
Medicare+Choice by saying only 11 percent of the people in this country 
join in and that is such a small percentage and that these figures are 
evidence it is not liked, go to Miami and ask 45 percent of the 
citizens who belong to Medicare+Choice why they like it.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from Arkansas.
  Mr. PRYOR. Mr. President, last night was a difficult night for me 
because I was lying in bed worrying about the insurance companies and 
how we were not getting them enough money during this Congress. Of 
course, I am being facetious because I think we have a very clear 
choice.
  I commend Senator Dorgan, Senator Durbin, and a number of others who 
have shown national leadership on this effort to try to make this bill 
better. I think there is a broad consensus that we want to add a 
prescription drug benefit to Medicare. We want to help seniors all over 
this country, but at the same time we have to make sure it is set up 
the right way. It has to make sense.
  Quite frankly, one of the things that to me does not make sense, and 
probably to most people around the country does not make sense, is that 
we might give a pretty healthy sum of money to the insurance industry.
  All over the country--and I know it is certainly true in my State--
insurance companies are raising premiums. It may be health care 
premiums--everybody knows those are going up. It may be property and 
casualty; it may be homeowners policies, auto policies, medical 
malpractice, legal malpractice. You name it, across the board, as far 
as I know, the price of every single kind of insurance in this country 
is going up.
  Nonetheless, there are some in this Congress who want to actually 
give them a sizable chunk of money that could go to people who really 
need the help.
  I take my hat off to Senator Dorgan for his leadership. One thing he 
has figured out is a way to make the monthly premium less for people. 
Now, saving $6 a month to someone at my income level, and all of our 
income levels, that is not a lot of money, but for those senior 
citizens all over this country who live below the poverty level--the 
only money they get every month is Social Security, maybe a little help 
from the family--$6 is a lot of money. Six dollars may make this 
program affordable for them. It is real money. It is money that at the 
end of the year, if you add it up, is only $72 a year, but that is real 
money to so many Americans all over this country.
  The purpose of the bill, not just this amendment but the whole bill, 
is to help Americans afford their prescription drugs. I know that 
Senator Durbin, who is in the Chamber, and Senator Dorgan and a number 
of others in this Chamber have tried to make prescription drugs more 
affordable in this legislation. There have been different efforts tried 
in different ways. One of the things I tried was to strengthen 
reimportation from Canada to try to make prescription drugs more 
affordable, but certainly making the premiums more affordable makes the 
program more accessible to more Americans. That is a win/win/win for 
everybody.
  So I thank the Senator from North Dakota for yielding me some of his 
time. I know he is frantically talking to colleagues to try to have 
them adopt this amendment when we vote on it this afternoon.
  Let's run through the numbers very quickly one more time so we 
understand clearly what we are talking about. This amendment expends 
$2.4 billion per year to make premiums cheaper. It will reduce the 
typical premium--this is average--by $6 a month.
  I take my hat off to the folks in this Chamber who worked out 
compromise after compromise after compromise trying to come up with 
solutions to make this bill something that will become law, something 
that the majority of Members can vote for, not just in this Chamber but 
the House, something the President can sign.
  I believe strongly people in this country deserve to have access to 
these wonderful prescription medications that are in many ways miracle 
drugs. It is a shame for this country to have these drugs available on 
the marketplace but so expensive that people cannot afford them. That 
is what we are trying to accomplish.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from Illinois.
  Mr. DURBIN. I thank my colleague from Arkansas as well as my 
colleague from North Dakota. They have come to the floor and said to 
the Members of the Senate, look, we found $12 billion. Imagine $12 
billion over a period of time. We are in the middle of debating a 
prescription drug bill. What would the Senate do with new found money, 
$12 billion worth?
  We took a look at the underlying bill, the prescription drug bill. 
There are a lot of problems with it. There is no guaranteed monthly 
premium. It has a deductible. It has a period of time when there is no 
coverage. You are paying prescription drug bills and you have no 
protection, no coverage. There are a lot of uncertainties in this bill.
  You would think the first thing you would do with the $12 billion is 
make this a stronger bill, try to take care of some of the weaknesses, 
the deficiencies.
  Wrong. Given $12 billion, an agreement has been reached not to give 
the money to the seniors to help them pay for prescription drugs but to 
give $6 billion to HMOs and private insurance companies, a $6 billion 
Federal subsidy so they can experiment with alternatives to Medicare.
  I am like my colleague from Arkansas; I could not get a moment's rest 
last night for fear that we just were not going to give enough money to 
the insurance companies when this was all over with. I lost all my 
sleep the night before worried about the fact that maybe pharmaceutical 
companies would not get all the money that we could possibly throw 
their way. Then along comes this amendment. We can rest easy tonight 
because we will give $6 billion to HMOs. This industry which 
manufactures the milk of human kindness for seniors and families across

[[Page 16628]]

the America by denying basic health care coverage so they can run up 
profits is going to need a Federal subsidy.
  What a delicious irony that we cannot help poor seniors trying to pay 
for prescription drugs because, Senator, we just do not have enough 
money. And we cannot help our schools, we cannot pay for President 
Bush's No Child Left Behind, this unfunded mandate on everybody's local 
schools because, Senator, we just do not have enough money. But the $6 
billion we just found we are going to give to the HMO insurance 
industry.
  When they write the history of this debate, this amendment will stand 
out. This amendment is a tribute to selfishness, a tribute to 
shortsightedness. Why in the world aren't we helping the people who 
need it the most? Why are we giving the money to the HMOs so they can 
experiment with an effort to end Medicare?
  I just ran into Bill Thomas in the hallway, chairman of the House 
Ways and Means Committee, most powerful man when it comes to Medicare 
in the House of Representatives. He said in today's New York Times:

       Some of our friends on the other side of the aisle are 
     saying if this bill becomes law, it will be the end of 
     Medicare as we know it. Our answer to that is, we certainly 
     hope so.

  Well, thank you, Congressman Thomas, for your candor. And your candor 
is the reason why so many Senators have now come to the Senate and said 
the only way to end Medicare is to subsidize HMOs with even more money 
so they can be more profitable and try to force Medicare out of 
business. That is what it is all about.
  My colleagues will have two choices. They can join me in voting with 
Senator Dorgan, Senator Pryor, and others and say if you have $12 
billion, for goodness' sake, put it into this bill. Make this bill a 
little better for seniors. Reduce the cost for seniors. Give them some 
assurance of what they will pay. Provide more prescription drug 
coverage. That is one option. I will support it.
  If it does not succeed, I will offer a second option. It reaches a 
point under the bill we are debating, during the course of a year, when 
there is a gap in coverage where the Federal Government will not help 
pay one penny on your prescription drugs, and about $3,700 into the 
year out-of-pocket expenses for prescription drugs, this plan cuts off. 
The underlying plan says you are on your own until you get in the range 
of $5,500. Then we will start paying you again. So there is a gap in 
coverage where that senior citizen, that widow living by herself, has 
to pay all of the prescription drug bills until she reaches the 
catastrophic coverage level.
  This would not be a problem if you did not have over $3,700 in 
prescription drugs a year. But a lot of seniors do. I have run into 
them, met them in Illinois, heard their testimony on Capitol Hill from 
across the country.
  I will offer an alternative to my colleagues in the Senate that says 
simply this: We want to make sure people who suffer from some of the 
most expensive diseases that afflict senior citizens can pay for their 
medication. So we will take the $12 billion and we will put it into the 
basic bill and cover heart disease, cancer, Alzheimer's, diabetes and 
its complications.
  We are not going to leave you high and dry. At the end of $3,700 of 
subsidy from the Government, we are going to take the $12 billion and 
put them back in there to try to keep helping you if you are afflicted 
with one of these diseases.
  I will readily concede to my colleagues that I can think of a half a 
dozen other diseases where people have horrendous prescription drug 
bills and need help but I will try to appeal to my colleagues. Here is 
your choice. You have a parent or a grandparent, suffering from cancer, 
who has to buy expensive drugs to stay alive. The Government program 
that we are proposing stops paying for those drugs halfway through the 
year because they have reached a point where they spent $3,700 and now 
they have to wait and spend another $1,500 to $1,800 of their own money 
before they have coverage. You can help them pay for those cancer 
therapies or you can send $6 billion in Federal subsidies to HMO 
insurance companies.
  That is the choice. It is a fairly straightforward choice.
  According to a July 2002 study, heart disease and hypertension are 
the most expensive conditions to treat. Millions of Medicare 
beneficiaries are suffering from them and struggling to pay for their 
medications. That is one of the conditions we would help pay for with 
the $12 billion, $6 billion of which is headed for these private 
insurance companies' subsidy.
  The majority of America's cancer patients are on Medicare. They are 
your parents and grandparents. They are struggling with all forms of 
cancer. Nearly 60 percent of new cancer diagnoses and 50 percent of all 
cancer-related deaths occur in people 65 years and older.
  I am not identifying a problem that does not exist. It exists. Ask 
any family about cancer, my family included. We all have stories to 
tell. And you know how expensive it is now to keep that loved one alive 
to try to give them a chance to survive. This bill cuts them off and 
leaves them high and dry. My amendment gives them a chance.
  More than 2 million of all Medicare beneficiaries will have cancer in 
2003. Let me give an example of a couple who wrote to my office. They 
wrote a couple years ago from a downstate community, a small community. 
It is one of the letters that Senators get every day, one that we 
saved. It was sent to us in September of 2002.

       Dear Senator Durbin:
       My wife has multiple myeloma, which is a cancer of the bone 
     marrow. This disease, while controllable, is not curable. As 
     a result, she has to take a great deal of drugs for physical 
     as well as mental anxiety.
       Last year our combined prescription drug bill [and this is 
     the year 2000] was $4,500. This year our regular prescription 
     drug bills will be more.
       Now my wife Marion has been put on Thalidomide. A great 
     many multiple myeloma patients are now on Thalidomide. Said 
     drug is very expensive. With a low dose [and this is in the 
     year 2000] it is $455.99 a month.

  Incidentally, we checked. That same low dose now costs $645 a month. 
So in 3 years it has gone up over 40 percent. It costs them $5,500 a 
year just for that drug. This is an elderly couple in their retirement 
on a fixed income, fighting cancer, putting every dollar in their 
savings into keeping one of them alive. Think about $644 a month. Think 
about seniors trying to survive on $1,100 a month on Social Security. 
And think about this bill which says to this family from Illinois and 
others just like them: I am sorry, but at some point we are going to 
stop paying.
  Doesn't it make more sense for us to take the $6 billion and not give 
it in a subsidy to these private insurance companies but instead give 
it to these seniors to help them pay these bills? I think it does.
  I don't have to tell you the story of Alzheimer's. Is there a family 
in America that does not have a loved one or a friend who is struggling 
with some form of Alzheimer's? God bless us; we are living longer, but 
as we do life gets more complicated. Let me give an example of a 
gentleman in Maplewood, MN. His annual out-of-pocket drug costs for 
Alzheimer's are $7,000--annual cost. This man is 78 years old. He pays 
as much out of pocket for prescription drugs as he does for all of his 
other household expenses combined. He is a World War II vet, father of 
three. He is a full-time caregiver for his wife. He hasn't had a 
vacation in 5 years. He has given up what he loves to do because he 
just can't afford them.
  ``I am managing the cost, but I'm pretty nervous about it,'' he says. 
Medicare can do something to help. Yes, it can. That is our choice. Are 
we going to do something to help these seniors facing the most 
expensive medical conditions or are we going to give $6 billion to 
private HMOs in a Federal subsidy?
  The last one I include is diabetes and its complications. I am sad to 
report to you, those who are following this debate, diabetes is 
reaching epidemic proportions in America. Over 6 percent of the 
American population suffers from some form of diabetes. In the late 
stages of diabetes, the complications become horrible: Amputations, 
blindness, severe problems.

[[Page 16629]]

  Faced with this in your senior retirement years, depending on a 
prescription drug plan, do you really want to say to these people and 
these families battling diabetes and its complications: We are going to 
cut you off. We would love to give you more but frankly we have to help 
the HMO insurance companies. Those are the ones who really need a 
helping hand.
  You couldn't take that argument to any town in America. You couldn't 
take it to any public meeting. You couldn't take it to any senior 
citizens. You couldn't take it to any family with a loved one 
struggling with one of these diseases.
  So my friends on the floor of the Senate are going to have a choice: 
$6 billion in Federal subsidies for HMOs or $6 billion to help seniors 
struggling with these terrible, life-threatening, expensive conditions, 
to pay their prescription drug bills. I think that choice is easy. I 
hope the majority of the Senate agrees.
  I reserve the remainder of my time.
  The PRESIDING OFFICER. Who yields time? The Senator from Iowa.
  Mr. GRASSLEY. Mr. President, I yield myself such time as I might 
consume to address the issue of the amendment by the Senator from North 
Dakota and his attempt to take money from the $12 billion that is the 
bipartisan compromise that is a major compromise on this amendment 
between Republicans and Democrats. The $12 billion is being divided: $6 
billion to make the marketplace provider organizations more 
competitive, to save money, and to get people into organizations that 
will manage particularly chronic disease; and the other $6 billion to 
go for Medicare demonstration projects to do the same, have about the 
same result, to have chronic disease management.
  The reason for this compromise is both approaches deal with the issue 
that 5 percent of the sick people under Medicare are responsible for 
about 50 percent or 55 percent of the cost of Medicare. It is a small 
segment of people. If we were in business and we found 5 percent of our 
employees, or a certain problem we had with our business that was just 
5 percent of it, but it was 50 percent of the cost of our business, we 
would hone in on that problem with the particular business.
  The Federal Government is in the business of providing health care 
for our seniors. If we have 5 percent of our senior population who, for 
various reasons, are the cause of 50 percent of the costs of Medicare, 
then quite obviously we ought to concentrate on that 5 percent. We have 
plans to do that. This is how we use this $12 billion, and we do it in 
a bipartisan way.
  Honestly, the Senator from North Dakota is very open about it; he has 
a better idea how to use that money. He would take it to lower the 
monthly premium paid by beneficiaries in the new Part D prescription 
drug program.
  I have at least two problems with that. First of all, the 
Congressional Budget Office's rule of thumb is that it costs around $5 
billion to lower the estimated $35-a-month premium by just $1. You 
spend $5 billion and reduce the monthly premium from $35 down to $34. 
So if you take the $12 billion that is available in the Grassley-Baucus 
amendment and use that to lower the premium for the people he wants to 
lower the premium for, instead of paying $35 a month they will be 
paying $32.50 a month.
  My colleagues have to weigh that against the use of this money where 
we want to focus in on fee for service as well as the new Medicare 
Program, zeroing in on trying to save Medicare money by managing the 
chronic disease situations of the 5 percent of the most sick people 
under Medicare.
  So the underlying Grassley-Baucus amendment, I remind my colleagues, 
authorizes the Secretary to establish a number of projects in fee-for-
service Medicare Programs that would provide these enhanced services 
and benefits for beneficiaries. These enhanced services or benefits 
include preventive services, chronic care coordination, and disease 
management services. These are very worthwhile projects and have the 
potential to help many beneficiaries get better care and considerably 
reduce the cost in the Medicare Program.
  I don't know how many Members on the other side of the aisle have 
worked with this issue we are trying to put $6 billion toward, chronic 
disease management. A lot of people who have the same political 
philosophy as the Senator from North Dakota are very concerned about 
doing that. We are concerned on this side about doing it as well. That 
is why it is a bipartisan piece of legislation.
  I don't know how, in good conscience, the Senator from North Dakota 
can take money that would reduce a monthly premium by $2.50, still 
costing $32.50, away from chronic disease management and a lot of other 
things that people on his side of the aisle are very concerned about.
  It would not be possible to do these projects that we have in the 
underlying amendment. It seems to me that the Grassley-Baucus amendment 
with this bipartisan compromise of $6 billion enhanced membership in 
PPOs as well as $6 billion for chronic disease management in the older 
fee-for-service Medicare Program is preferable to the second-degree 
amendment offered by the Senator from North Dakota.
  I urge my colleagues to not support the amendment by the Senator from 
North Dakota.
  This is the second or third time I have heard that seniors have voted 
on whether they like fee for service or Medicare+Choice, the argument 
being 89 percent of the people in this country are in fee for service. 
Eleven are in managed care, Medicare+Choice, HMO, whatever you want to 
call it. That is true for the Nation as a whole.
  But remember that in the vast geographical part of America HMOs are 
not available. In the State of Iowa, only 1 county out of 99 has an HMO 
for our seniors to join. We have 4,000 Iowans in Medicare+Choice. No 
place else in Iowa can my citizens get it. The Des Moines Register is 
always editorializing why more of Iowa cannot have Medicare+Choice so 
the seniors of our country have that opportunity.
  But what is unfair about the 89 percent versus the 11 percent, and 
Senators making statements that it is so overwhelming that seniors do 
not like Medicare+Choice, is the fact that if more had that choice more 
would take it.
  I use, as a basis for my statement, that in the larger cities of 
America a much higher percentage of seniors have decided to join 
Medicare+Choice. They do it voluntarily. They can go in one year and 
get out the next, if they don't like it. They have voted by a much 
higher percentage in favor of Medicare+Choice. They like it because 
they get more for their money. First, they do not have to pay Medigap 
insurance. Second, they might get things such as eye glasses and a 
better deal on prescription drugs than people who are in traditional 
Medicare fee for service. Where they have had a chance to have that 
option, a much higher percentage of seniors than 11 percent will join. 
All you have to do is talk to people in my State who go to Arizona, 
California, and Florida for maybe the winter and find out about what 
people in those States have when they join Medicare+Choice. They ask, 
Why can't we have that in more places in the country?
  A couple of speakers on the other side of the aisle have talked about 
wasting money with Medicare+Choice. I think you ought to ask the 
seniors who join and who like it. That is a much higher percentage than 
11 percent in a lot of the cities. It is not a fair comparison to imply 
that since only 11 percent of the people in the country have it and 
because such a high percentage can't get it that Medicare+Choice is not 
desired by seniors of America.
  Our underlying legislation, the Grassley-Baucus bill, is going to 
make that opportunity more available for people down the road as we 
bring in new options. What we want to do in the underlying bill is give 
our seniors the right to choose. Not enough of them have a right to 
choose. They have a right to choose prescription drugs. They don't want 
to join for prescription drugs if they don't have to. They have a right 
to choose between traditional Medicare. If seniors say they are

[[Page 16630]]

satisfied with what they have, I can say to those seniors that they can 
keep what they have. It is their choice. But it you want to go over 
here and join something that has more options, you will have that right 
to choose. You should have that right to choose.
  One of the complaints people made about the President's program was 
that if you were going to get prescription drugs you had to go over to 
a new type of Medicare. In traditional Medicare, you could not get 
prescription drugs--or at least not much of a program; at least not 
equal to what you could get over here in the new program.
  That is where Senator Baucus and I disagree with the President of the 
United States. We believe in equal benefits. If you want prescription 
drugs, if you want to join it voluntarily, and if you want to stay in 
traditional Medicare fee for service, you can have prescription drugs. 
If you want to go over here and choose a new form and have prescription 
drugs with it, that is your choice.
  The right to choose and fairness and equality and no pressure is the 
basis for this bipartisan Grassley-Baucus legislation. That is the 
basis for the compromise amendment that is before us which the Senator 
from North Dakota wants to detract from and use the money someplace 
else.
  I think we need to keep this balanced approach. We need to keep the 
fairness, the equality, and no pressure and the right to choose. 
Seniors should have options just as other people have.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from Illinois.


                           Amendment No. 1108

  Mr. DURBIN. Mr. President, I call up my amendment, which I send to 
the desk pursuant to the unanimous consent request.
  The PRESIDING OFFICER. The clerk will report.
  The assistant legislative clerk read as follows:

       The Senator from Illinois [Mr. Durbin] proposes an 
     amendment numbered 1108.

  Mr. President, I ask unanimous consent that reading of the amendment 
be dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The amendment is as follows:

    (Purpose: To provide additional assistance for certain eligible 
                      beneficiaries under part D)

       At the appropriate place insert the following:

     SEC. __. ADDITIONAL ASSISTANCE FOR CERTAIN ELIGIBLE 
                   BENEFICIARIES UNDER PART D.

       Section 1860D-26, as added by section 101, is amended by 
     adding at the end the following:
       ``(d) Additional Assistance for Certain Eligible 
     Beneficiaries.--
       ``(1) Program.--Subject to paragraph (2), the Administrator 
     shall implement a program (for the period beginning on 
     January 1, 2009, and ending on September 30, 2013) to provide 
     additional assistance to applicable eligible beneficiaries 
     who have reached the initial coverage limit described in 
     section 1860D-6(c)(3) for the year but have not reached the 
     annual out-of-pocket limit under section 1860D-6(c)(4)(A)) 
     for the year in order to reduce the cost-sharing requirement 
     during this coverage gap.
       ``(2) Funding limitation.--The Administrator shall 
     implement the program described in paragraph (1) in such a 
     manner that will result in a decrease of $12,000,000,000 in 
     cost-sharing for covered drugs under part D by applicable 
     eligible beneficiaries during the period described in such 
     paragraph. The Administrator shall take appropriate steps to 
     ensure that the costs of the program during such period do 
     not exceed $12,000,000,000.
       ``(3) Applicable eligible beneficiary.--For purposes of 
     this subsection, the term `applicable eligible beneficiary' 
     means an eligible beneficiary with cardiovascular disease, 
     diabetes and its complications, cancer, or Alzheimer's 
     disease who is enrolled under part D.''.

  Mr. DURBIN. Mr. President, I will speak briefly because I have to go 
to another meeting and return for the vote.
  I have great respect for the Senators from Iowa and Montana, but I 
struggle to understand why we are giving a $6 billion subsidy to the 
HMOs in America. If they are so good, if they are so efficient, if the 
free market is truly better than the Government-run Medicare system, 
why in the world do they need $6 billion worth of the taxpayers' money? 
You know that of that $6 billion hundreds of millions of dollars are 
going to go to them in profits. We are literally subsidizing the 
profits of these companies. We are creating this artificial environment 
that suggests these companies can do just as good a job or better than 
Medicare with the $6 billion Federal subsidy to make it work.
  I can't understand why my colleagues on the conservative side who are 
hidebound apostles of the free market system don't even wince when it 
comes to sending $6 billion to the HMOs and the private insurance 
industry in order to let them play on the field for health care for 
seniors in America. I don't get it. I certainly don't understand why 
you wouldn't take that same money to protect the most vulnerable people 
in America--our senior citizens who are struggling with heart disease, 
cancer, Alzheimer's, and diabetes and its complications. Why is the 
money for the boardrooms of the HMOs a good expenditure of tax dollars 
and the money for the family rooms of senior citizens struggling with 
these deadly diseases not a good investment with taxpayer dollars?
  The underlying bill is the biggest breakthrough for the American 
pharmaceutical industry since the establishment of patents in the 
Constitution. This amendment with $6 billion in flatout tax subsidies 
to HMOs is the answer to the prayers of the insurance companies in 
America.
  Is that what the Senate is all about? Are we supposed to come here to 
make certain that the wealthiest corporations in America get wealthier? 
I don't think so. They are doing quite well. The rate of return for 
pharmaceutical companies across America is 18 percent. The average for 
the S&P companies is 3 percent. These companies are immensely wealthy 
and profitable. We help them even more with this bill. We know how well 
the insurance companies are doing. We know the bonuses they give their 
executives and we are going to plow in $6 billion to make it even 
wealthier.
  There is something else wrong. We know that a lot of average citizens 
in America--particularly senior citizens--are struggling. Pick up the 
morning papers. Whether it is the Washington Post or the New York 
Times, they go to speak to seniors in their real-life environment and 
talk to them about how they survive. Some of them are well off. Some 
are lucky. They have saved a lot of money or they have a good and 
generous retirement but a lot of them do not. A lot of them are 
literally struggling month to month, some even week to week, just to 
get by.
  This morning in the Washington Post there was a story about a widow 
lady who said: At the end of the month, I'm lucky if I have a dollar 
left over. At the end of the article she said: I wonder how many 
Senators have ever thought about trying to live on $1,100 a month.
  I don't know how she does it. I don't know how a lot of people do it 
in my State. Why wouldn't we want to help these people? Why is it the 
pharmaceutical companies and the HMOs are more important than the most 
vulnerable people in society? I don't get it.
  Frankly, I think a lot of our colleagues, as I said earlier, ought to 
take these arguments, which sound so good on the floor of the Senate, 
back to the real world of the State they represent, take them into the 
town of their choice, the public meeting of their choice, and explain 
to people why HMOs need a subsidy but seniors do not need a helping 
hand. It just does not work.
  So I will be offering an amendment that says we will take this $12 
billion and focus it on the elderly people who suffer from some of the 
worst and most demanding diseases.
  I reserve the remainder of my time.
  The PRESIDING OFFICER (Mr. Alexander). Who yields time?
  The Senator from Montana.
  Mr. BAUCUS. Mr. President, I listened quite closely to the Senator 
from Illinois, as well as to the Senator from North Dakota. They are 
each offering a separate amendment, but they are both similar in an 
attempt, generally, to accomplish the same result.
  I say to my good friend from Illinois, as well as my good friend from 
North Dakota, who is presently not in the

[[Page 16631]]

Chamber, I am very sympathetic. If I had my way, we would be spending 
this newly found $12 billion very much in the way the Senator 
suggested. In fact, there are a lot of good ways. It is not only 
helping those with Alzheimer's, but it is also lowering the premium. 
There are a lot of ways we could be spending dollars to help get more 
drug benefits to more seniors. There is no doubt about that. But, 
unfortunately, we are 100 Senators.
  The Senator from Illinois, the Senator from North Dakota, and I have 
a view of how some of these dollars should be spent in a perfect world, 
but the world is not perfect. This is a democracy. It is messy. As 
Winston Churchill once said--I will paraphrase very poorly, but the 
Senator knows this quote--basically, Winston Churchill said: A 
democracy, for all its fits and starts and delays and inefficiencies 
and herky-jerky jolting, and all that, is the world's worst form of 
government, except for all the others.
  Here we are, in a democratic process, trying to figure out how to get 
prescription drug benefits to seniors. We have 100 Senators. I don't 
know of very many timid Senators. We don't have many Senators who don't 
speak their views. I don't know very many Senators who don't have 
strong views about subjects. I don't know of many Senators who are not 
thoughtful, articulate, and fighting hard for their constituents. And 
we have, as it turns out, Senators from two political parties: 51 
Republicans, 48 Democrats, and 1 Independent; and at this time we are 
attempting to finally get prescription drug benefits to seniors.
  This issue has been debated for 4 years, at least. It has been a 
politicized issue for 4 years. There has been a lot of talk for 4 
years, a lot of rhetoric on both sides of the aisle for 4 years, and 
during all the talking there has not been any action; it has been all 
words, no deeds.
  Well, here we are, at a time--after 4 years of just political 
posturing, to a large degree--where we are on the brink of getting 
prescription drug benefits passed for our seniors in our country.
  Is it the best bill in the world? No. Could it be better? Yes. Do all 
Senators wish it could be better? Yes. But is it a good start? Is it a 
beginning? Is it a platform on which we can begin to build? Absolutely.
  If we go back and look at the history of health care and assistance 
by the Government in providing health care to the needy and to 
Americans generally, it is a history of building, of starting 
somewhere, building on it, and making it better and better all the 
time.
  Back in the 1930s it was the Wagner-Murray-Dingell legislation that 
was introduced to provide national health insurance for Americans. That 
was the idea: We need national health insurance for Americans.
  Well, it was debated and debated. Not a lot more really happened. 
Then suddenly things changed in the 1960s. The idea of Medicare came 
along: Why not help at least our seniors? If we can't get national 
health insurance, the very least we can do is help our senior citizens 
get a break with respect to their health care bills. That is a good 
place to at least begin--by helping a good, solid segment of the 
population. And we did, back in 1965, by providing Medicare. And look 
what has happened since then. We have kept building on Medicare to make 
it better.
  When Medicare was first enacted, 50 percent of a Part B premium was 
paid by the senior and the Government paid the other 50 percent of the 
premium for Part B. That is for doctor services. Now it is 25 percent. 
It has been improved over time. We also have added more benefits, some 
screening provisions. End-stage renal treatment has been added. There 
is a list of new additions to help our senior citizens.
  Here we are now, on the brink of adding another major benefit: 
prescription drugs. After all these years, all the years of talking and 
talking and politicking and giving statements and speeches, we are 
finally on the brink of getting prescription drug benefits passed.
  It has not been easy. Why has it not been easy? It has not been easy 
because there are two competing philosophies on the floor of the Senate 
on how to get prescription drug benefits to seniors. Even though the 
two competing philosophies are very different from each other, Senators 
on both sides of the aisle--most Senators, maybe even all Senators, but 
certainly most Senators--still want to work as hard as they can to try 
to fit these competing philosophies together in order to pass 
legislation this year to begin finally getting prescription drug 
benefits to seniors.
  Also, these two competing philosophies are very different. One is 
competition. The argument is: Let private companies, themselves, with 
assistance from the Government, design how they give prescription drug 
benefits to our senior citizens, make them available at a big discount 
for senior citizens. The other philosophy is: Medicare should be the 
agency that should be the way--traditional Medicare, basically--to 
provide discounts for senior citizens to get drugs.
  Essentially, the competing philosophies are 50-50. You have 51 
Republicans, 48 Democrats, and 1 Independent. What are we going to do? 
Well, all we can do, if we want to get this done, is to just try our 
best to put these two together in a fair, balanced way--and the private 
competition model gets a break, gets a fair chance to see the degree to 
which it might work--so that senior citizens really do get the benefits 
and are not taken advantage of during our efforts to pass legislation.
  It is a balance. It is trying to find the right way to accomplish 
that balance. It has been extremely difficult. I do not have to tell 
the Presiding Officer just how hard this has been. But we are right on 
the brink.
  We are limited to $400 billion in providing the drug benefits for 
seniors over the next 10 years. Why are we limited to $400 billion? 
Well, this body passed a budget resolution not too long ago--both the 
House and the Senate--saying we are going to set aside $400 billion for 
prescription drug benefits for seniors. We never set aside anything 
like that in the past. So we have an opportunity now to use it. I don't 
think Senators want to miss this opportunity. I think they want to use 
the dollars that are there to get prescription drug benefits for 
seniors.
  Well, as it turned out, when the Senate Finance Committee wrote this 
bill, trying its hardest to be balanced--and it is balanced; the best 
evidence of that is it passed by a large majority from both parties in 
the Finance Committee--we found it actually cost only about $388 
billion. There was $12 billion remaining.
  So the question before us is how we can spend that $12 billion. That 
is the question. In an attempt to maintain a balance and to work on two 
competing models and in an attempt to get the legislation passed so we 
can provide a prescription drug benefit to seniors, we have decided to 
split it, 6 and 6; $6 billion to the PPOs, have it available 
potentially for PPOs, if that is needed for the bidding process, 
beginning in the year 2009. I don't know how many Senators are going to 
be here in 2009, but at least beginning then. The other $6 billion, 
beginning in 2009, will then go, under Medicare fee for services, for 
disease management, chronic care, to help particularly seniors who 
really need that disease management and chronic care. It is really 
needed because there is very little disease management today under 
traditional Medicare. That is one of its shortcomings. That is what we 
have done.
  Again it is a balance, a start, a beginning. I have a lot of sympathy 
with my friends on this side of the aisle. If I had my druthers and I 
were the only one writing this bill, I would take that $12 billion and 
spend it along the lines they are suggesting. But I am not the only 
Senator here. I am one of 100. It is my job and that of the chairman of 
the committee, Senator Grassley, to try to find a balance--not for the 
sake of balance but for the sake of getting legislation passed so we 
can finally get prescription drugs to seniors.
  If the amendments offered by the Senators from North Dakota or 
Illinois were to pass, guess what would happen.

[[Page 16632]]

First of all, those are killer amendments. If those amendments were to 
pass, that would mean this bill is in jeopardy of passage. That would 
mean senior citizens may not get the prescription drug benefits we are 
all trying to get; albeit just a first step, or it could also mean, on 
the other hand--and this is perhaps even more likely--if that amendment 
were to pass, I will bet you dollars to donuts--which is not a good 
phrase to use because we are trying to put dollars in the donut hole--
the conservative part of this body, the Republican side of the aisle, 
would say: We are going to take that $12 billion and spend it our way. 
And they have the votes. They have the White House. So this amendment 
puts in jeopardy a very delicate, very balanced kind of deal between 
competing philosophies, fairly and evenly, so that we can get 
prescription drug legislation passed, so that we are just not talking 
about it anymore and finally doing something about it.
  If it were to pass or looked like it would pass, the other side, 
which has more votes than this side has, would say: We will spend it 
our way.
  Then colleagues on my side of the aisle would be quite distressed. 
They would be forced to ask themselves if they would support on final 
passage a bill way off to the right for competition instead of the bill 
which currently exists, particularly with the underlying amendment. I 
wish we could do more but at least it is a first step. If the history 
of Medicare is any guide, in future years we will continue to make it 
better. We will work on that donut hole. We will fill in the gaps. We 
will make sure premiums are not too high. We will try to help with 
Alzheimer's and all the other measures we desperately need to pay 
attention to as the days and years go by.
  I implore my colleagues to think a little bit. Resist the siren song 
of doing something that sounds good but which very well could put the 
bill in real jeopardy. This is fair. It has $6 billion which may or may 
not be used for PPOs, depending upon what the bids are. This bill cuts 
off after a 5-year period; no more $6 billion can be spent. And $6 
billion for disease management under traditional Medicare which will be 
spent. That is the question. Do you want balance or do you want to try 
to get something else passed right now that you like in the short term 
but could very well jeopardize the whole bill, which means another 
year, year 5, Congress is talking about this issue, Congress is not 
doing anything about it. Rather, we want year 1, we have finally got it 
done.
  We are very close to getting it done. It is not perfect, but we will 
keep working on it over the years.
  The PRESIDING OFFICER. Who yields time?


                    Amendment No. 1037, As Modified

  Mr. BAUCUS. Mr. President, on behalf of the Senator from New Jersey, 
Mr. Corzine, I ask unanimous consent that amendment No. 1037 be 
modified with the text that I send to the desk.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The amendment, as modified, is as follows:

       At the end of subtitle A of title I, add the following:

     SEC.   . CONFORMING CHANGES REGARDING FEDERALLY QUALIFIED 
                   HEALTH CENTERS.

       Exclusion From Per Visit Limit.--Section 1833(a)(3)) (42 
     U.S.C. 13951(a)(3)) is amended by inserting ``(which 
     regulations shall exclude any cost incurred for the provision 
     of services pursuant to a contract with an eligible entity 
     (defined in section 1860D(a)(4)) operating a plan under Part 
     D, for which payment is made by such entity)'' after 
     ``including those authorized under section 1861(v)(1)(A)''.

  Mr. BAUCUS. Mr. President, I ask unanimous consent that the pending 
amendments be temporarily laid aside.
  The PRESIDING OFFICER. Without objection, it is so ordered.


                           Amendment No. 1110

  Mr. BAUCUS. Mr. President, on behalf of the Senator from Michigan, 
Mr. Levin, I send an amendment to the desk and ask for its immediate 
consideration.
  The PRESIDING OFFICER. The clerk will report.
  The legislative clerk read as follows:

       The Senator from Montana [Mr. Baucus], for Mr. Levin, 
     proposes an amendment numbered 1110.

  Mr. BAUCUS. Mr. President, I ask unanimous consent that reading of 
the amendment be dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The amendment is as follows:

 (Purpose: To ensure that beneficiaries initially covered by a private 
   insurer under this act who are subsequently covered by a Medicare 
  fallback plan have the option of retaining a Medicare fallback plan)

       Insert the following in the appropriate place: The 
     Secretary of Health and Human Services shall retain or 
     designate one or more Medicare backup plans so that 
     beneficiaries initially covered by a private insurer under 
     this act who are subsequently covered by a Medicare fallback 
     plan have the option of retaining a Medicare fallback plan or 
     entering private insurance under this act.


                           Amendment No. 1111

  Mr. BAUCUS. Mr. President, I ask unanimous consent that the pending 
amendments be set aside so that I may send to the desk on behalf of 
Senator Levin an amendment to ensure that current retirees who have 
prescription drug coverage, who will loose their coverage as a result 
of enactment of this legislation, would have the option of drug 
coverage under Medicare fallback.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The clerk will report.
  The legislative clerk read as follows:

       The Senator from Montana [Mr. Baucus], for Mr. Levin, 
     proposes an amendment numbered 1111.

  Mr. BAUCUS. Mr. President, I ask unanimous consent that reading of 
the amendment be dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The amendment is as follows:

 (Purpose: To ensure that current retirees who have prescription drug 
coverage who will lose their prescription drug coverage as a result of 
  the enactment of this legislation have the option of drug coverage 
                      under the Medicare fallback)

       Insert the following in the appropriate place: The 
     Secretary of Health and Human Services shall retain or 
     designate one or more Medicare backup plans so that the 37% 
     of current retirees who have prescription drug coverage, 
     estimated by the Congressional Budget Office who will lose 
     their current employer retiree coverage as a result of the 
     enactment of this legislation will have the option to enter 
     either a Medicare backup plan or private insurance under this 
     act.

  Mr. BAUCUS. Mr. President, I ask unanimous consent that time under 
the quorum call be charged equally against both sides.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. BAUCUS. I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The legislative clerk proceeded to call the roll.
  Mr. BAUCUS. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.


                 Amendments Nos. 1027 and 1041, En Bloc

  Mr. BAUCUS. Mr. President, I ask unanimous consent that the pending 
amendments be temporarily laid aside and amendments numbered 1027 and 
1041 be immediately considered.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The clerk will report.
  The legislative clerk read as follows:

       The Senator from Montana [Mr. Baucus] proposes amendments 
     numbered 1027 and 1041, en bloc.

  Mr. BAUCUS. Mr. President, I ask unanimous consent that further 
reading of the amendments be dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The amendments are as follows:


                           amendment no. 1027

      (Purpose: To express the sense of the Senate regarding the 
implementation of the Prescription Drug and Medicare Improvement Act of 
                                 2003)

       At the end of title VI, insert the following:

     SEC. __. SENSE OF THE SENATE REGARDING IMPLEMENTATION OF THE 
                   PRESCRIPTION DRUG AND MEDICARE IMPROVEMENT ACT 
                   OF 2003.

       (a) In General.--It is the sense of the Senate that the 
     Committee on Finance of the Senate should hold not less than 
     4 hearings to monitor implementation of the Prescription Drug 
     and Medicare Improvement Act of

[[Page 16633]]

     2003 (hereinafter in this section referred to as the ``Act'') 
     during which the Secretary or his designee should testify 
     before the Committee.
       (b) Initial Hearing.--It is the sense of the Senate that 
     the first hearing described in subsection (a) should be held 
     not later than 60 days after the date of the enactment the 
     Act. At the hearing, the Secretary or his designee should 
     submit written testimony and testify before the Committee on 
     Finance of the Senate on the following issues:
       (1) The progress toward implementation of the prescription 
     drug discount card under section 111 of the Act.
       (2) Development of the blueprint that will direct the 
     implementation of the provisions of the Act, including the 
     implementation of title I (Medicare Prescription Drug 
     Benefit), title II (MedicareAdvantage), and title III (Center 
     for Medicare Choices) of the Act.
       (3) Any problems that will impede the timely implementation 
     of the Act.
       (4) The overall progress toward implementation of the Act.
       (c) Subsequent Hearings.--It is the sense of the Senate 
     that the additional hearings described in subsection (a) 
     should be held in each of May 2004, October 2004, and May 
     2005. At each hearing, the Secretary or his designee should 
     submit written testimony and testify before the Committee on 
     Finance of the Senate on the following issues:
       (1) Progress on implementation of title I (Medicare 
     Prescription Drug Benefit), title II (MedicareAdvantage), and 
     title III (Center for Medicare Choices) of the Act.
       (2) Any problems that will impede timely implementation of 
     the Act.


                           amendment no. 1041

  (Purpose: To require the Secretary of Health and Human Services to 
     conduct a frontier extended stay clinic demonstration project)

       On page 529, between lines 8 and 9, insert the following:

     SEC. 455. FRONTIER EXTENDED STAY CLINIC DEMONSTRATION 
                   PROJECT.

       (a) Authority To Conduct Demonstration Project.--The 
     Secretary shall waive such provisions of the medicare program 
     established under title XVIII of the Social Security Act (42 
     U.S.C. 1395 et seq.) as are necessary to conduct a 
     demonstration project under which frontier extended stay 
     clinics described in subsection (b) in isolated rural areas 
     of Alaska are treated as providers of items and services 
     under the medicare program.
       (b) Clinics Described.--A frontier extended stay clinic is 
     described in this subsection if the clinic--
       (1) is located in a community where the closest short-term 
     acute care hospital or critical access hospital is at least 
     75 miles away from the community or is inaccessible by public 
     road; and
       (2) is designed to address the needs of--
       (A) seriously or critically ill or injured patients who, 
     due to adverse weather conditions or other reasons, cannot be 
     transferred quickly to acute care referral centers; or
       (B) patients who need monitoring and observation for a 
     limited period of time.
       (c) Definitions.--In this section, the terms ``hospital'' 
     and ``critical access hospital'' have the meanings given such 
     terms in subsections (e) and (mm), respectively, of section 
     1861 of the Social Security Act (42 U.S.C. 1395x).


          Amendments Nos. 936, 938, 988, 1027 and 1041 en bloc

  Mr. BAUCUS. Mr. President, on behalf of the chairman of the 
committee, Senator Grassley, I ask unanimous consent that the pending 
amendments be set aside and that the following amendments be agreed to 
en bloc, and that the motions to reconsider be laid on the table en 
bloc: Amendments Nos. 936, 938, 988, 1027, and 1041.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The amendments were agreed to en bloc.
  Mr. BAUCUS. Mr. President, I ask unanimous consent that the time I 
used be charged equally to both sides.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. BAUCUS. Mr. President, I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The legislative clerk proceeded to call the roll.
  Mr. GRASSLEY. Mr. President, I ask unanimous consent that the order 
for the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. GRASSLEY. I ask unanimous consent to proceed as in morning 
business.
  The PRESIDING OFFICER. Without objection, it is so ordered.

                          ____________________